On the night of October 5, Bitcoin rose to $86,972, but sellers pushed the price back below $86,000. This is already the second failed attempt to break through the $87,000 area in the past week.
What's happening with the price
At 07:35 MSK, BTC was trading around $85,613. The daily range was $84,806-$86,972. At the same time, Bitcoin remains one of the strongest assets among the largest cryptocurrencies over the week with a result of about +2.59%. Ethereum was trading around $2,705 at the time.
Shorts got liquidated again
Over the past day, positions worth approximately $152.17 million were liquidated across 45,620 traders. The bulk of the volume came from short positions. Short liquidations amounted to about $113.64 million, while long positions totaled $38.54 million. Liquidation is the forced closure of a leveraged position when the margin becomes insufficient to maintain it. The largest single liquidation occurred on the ETH-USDT pair for about $5.63 million.
Why the rally was so sharp
The move was supported not only by ordinary buying. At the same time, the market was sharply revising its expectations for the Fed rate. The probability of another 0.25 percentage point rate hike at the October 28 meeting fell from 66% in late September to about 22% by October 2. This shift in expectations supported demand for risk assets, including cryptocurrencies.
What happened before the jobs report
On the morning of October 2, even before the release of US labor market data, shorts worth about $50 million were liquidated in a short period of time. After the statistics came out, the move reversed. By evening, BTC was more than 1% below the level at which it was trading before the release. This showed how heavily the current dynamics depend not only on spot demand, but also on leveraged positions.
What open interest shows
Open interest, that is, the total volume of active futures positions, rose by about $2.1 billion before the data release. After the market reversed, it shrank by about $1.5 billion. This means that participants were actively building positions during the rally, and then some of them were closed or liquidated on the pullback.
Institutional demand persists
Spot Bitcoin exchange-traded funds continue to show net capital inflows. On October 1, inflows amounted to about $102 million. Positive dynamics have persisted for more than a month. On-chain data also points to a recovery in spot demand, which remains one of the factors supporting the price.
What market sentiment shows
The Fear and Greed Index is at 70 points, which corresponds to the greed zone. The day before, the reading was 65, and a week ago it was 74. This suggests that the market remains optimistic despite the second failure near $87,000.
What's next
The main technical zone remains the $87,000 area. Repeated breakout attempts show the presence of strong supply above the current price. The next major macroeconomic reference point will be the Fed meeting on October 28. Until then, the market will react to new inflation and employment data and changes in rate expectations.
Did you short this move to $87,000?
Two rally attempts in a week, large liquidations, and a quick return below $86,000 show how important risk management rules are. In prop programs for cryptocurrencies, the conditions can differ noticeably. In some, the daily drawdown is calculated from the account's daily maximum, in others from the balance at a specific moment. The leverage on BTC and the rules for holding positions overnight also differ. These conditions are better checked before paying for a challenge, not during a sharp market move.