Bitcoin [BTC] seems to have reached a bottom around the middle of the descending trend channel it has adhered to for the past seven months.
Following a brief rise to $66K, BTC started a correction, leading to speculation among traders that the fourth quarter could bring about bullish momentum in the wider cryptocurrency market.
An interesting development supporting this outlook is the shift from borrowing BTC during price surges to borrowing USDT during price declines.
Traders are increasingly opting to borrow USDT to capitalize on market dips and boost their exposure to Bitcoin, a positive sign for the upcoming quarter.
Bitcoin disrupting market dynamics
The current price movement of Bitcoin reinforces this optimistic sentiment. After disrupting the market dynamics of the BTC/USD pair, the price dropped to form a higher low following significant liquidations of long positions.
This recent bottom now paves the way for a potential upward push. For the bullish trend to continue, BTC must surpass the Daily 200 Moving Average (200MA) and exceed last week’s peak prices.
If Bitcoin manages to break through these resistance levels, the next crucial target will be $70K, indicating a stronger bullish momentum unfolding in Q4.
Short-Term Holder MVRV and SOPR undergoing reevaluation
Other metrics like the Bitcoin Short-Term Holder MVRV and SOPR suggest positive prospects as well.
Both metrics are retesting the neutral “1” line, implying that a rebound from this position would confirm a more optimistic forecast for BTC.
This juncture is pivotal for short-term speculators, as a bounce here could drive further price appreciation, potentially benefiting both short-term traders and long-term investors.
This situation enhances the possibilities of Bitcoin achieving new highs before the year concludes.
Significant liquidity positioned above
Moreover, the Bitcoin liquidation heatmap indicates a substantial amount of liquidity located above the current price level.
Given that price movements tend to gravitate towards regions of high liquidity, this suggests that BTC is poised for an upward trajectory.
The biggest liquidity cluster is situated between $63K and $66K, hinting that Bitcoin might witness a “short squeeze” if upward momentum gains strength in the upcoming days.
Although there is some liquidity below $60K, it is not concentrated, indicating that the path of least resistance favors an upward movement.
Bitcoin seems well-placed for potential upticks as Q4 unfolds. Factors like increased USDT borrowing, the establishment of a bottom, and the liquidity heatmap all align towards a bullish scenario.
With $70K looming on the horizon, BTC could be gearing up for a robust year-end, rewarding traders who have positioned themselves for the next upward movement.