Bitcoin has surged to $66,677, nearing its highest daily close since July, with hopes of reclaiming $70,000. While apparent demand is increasing, retail interest remains low. The current rally has been driven by the derivatives market, raising concerns over leverage risks. Bitcoin faces strong resistance at $68,000, and its ability to maintain upward momentum hinges on overcoming this barrier.

Bitcoin (BTC) has recently demonstrated significant momentum, achieving a price of $66,677, which positions it for its highest daily close since July 31. This surge included an intra-day peak of $67,953, signifying a new higher high (HH3) beyond the previous local top of $66,450 reached on September 27. The market witnessed a 6.17% increase on October 15, with growing expectations for Bitcoin to reclaim the $70,000 threshold for the first time in the second half of 2024. However, the ongoing rally has been characterized by a noticeable absence of retail demand. Crypto Rover, the Founder of Cryptosea, pointed out that despite Bitcoin approaching its all-time high, “retail interest is close to zero.” Conversely, Ki Young Ju, the CEO of CryptoQuant, noted an uptick in Bitcoin’s apparent demand, which is a crucial metric reflecting the balance between new supply from mining and long-term holdings. This apparent demand, which has historically surged before significant price rises since 2016, matches levels observed in February 2024, predating Bitcoin’s peak of $73,800 in March. Furthermore, Axel Adler Jr., a Bitcoin on-chain researcher, emphasized a 3% increase in coin purchase demand from new investors over the last ten days, which bodes well for the market. There was also a positive rise in the Coinbase and Kimchi premiums, suggesting increased retail investor interest, although the overall premiums remain negative, indicating a potential ‘disbelief’ rally, wherein investors are purchasing Bitcoin at relatively lower prices ahead of a price surge. However, it is imperative to approach this rally with caution. The recent price ascent has largely been attributed to leverage in the derivatives market, with a notable $800 million increase in open interest last weekend as prices climbed to $64,500. Market analyst Maartunn expressed concern, stating that the preceding price drop was exacerbated by excessive leverage. The Bitcoin heater chart from Capriole Investments corroborates this view, indicating that the futures market is currently overheated, potentially necessitating a correction. Currently, Bitcoin faces a crucial resistance level at $68,000. While there are optimistic projections for Bitcoin to surpass the psychological barrier of $70,000 before October 20, the substantial overhead resistance between $67,000 and $68,300 may delay this breakthrough. As price action suggests, further testing of this range is essential, especially given historical trends where higher highs have been followed by corrections. Thus, a successful daily close above $68,300 in the coming days may be critical for Bitcoin to maintain its upward trajectory. This summary does not constitute investment advice and emphasizes the inherent risks associated with trading and investment. Readers are advised to conduct thorough research before making financial decisions.

The article discusses the recent price movements of Bitcoin, highlighting its surge to $66,677 and speculations surrounding its potential to reach $70,000. It notes the unusual circumstances of this rally, particularly the lack of retail investor interest, which has historically played a significant role in Bitcoin price movements. The article also delves into metrics such as apparent demand, market behavior, and the influence of the derivatives market on Bitcoin’s price trajectory. The analysis includes insights from various industry experts and emphasizes cautiousness due to the highly leveraged nature of the current rally.

In conclusion, Bitcoin’s recent rally to $66,677 has generated optimism for a potential breakout above $70,000. However, the lack of retail interest amidst rising apparent demand and increasing leverage in the derivatives market poses risks. A critical resistance zone between $67,000 and $68,300 suggests that Bitcoin must maintain its momentum and achieve significant closes above these levels to solidify its bullish outlook. Investors are advised to approach the current market dynamics with caution.

Original Source: cointelegraph.com

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