November 3: Daily BTC Analysis

Bitcoin is down 1.7% on the day, having tried to push higher in early trading. A telling sign is the failure of bulls to test resistance at $64,890, with the rally stopping short and heading back to support at $61,700.

The general chatter is bullish across the market, with various Alts hitting new ATH's. Which is probably the ideal time to take a look at what could spoil the party. 

Funding rates are heading back towards the levels seen at the all-time high. 

We can see from the estimated leverage ratio across all exchanges that the bullish fever is definitely leading traders to assume leveraged positions, hoping that a run towards the ATH and push towards $70,000 materialises.  

Which leads us to the below chart. The liquidation of leveraged longs. 

You don't need to be Satoshi Nakamoto to work out where the pain is for the leveraged crowd. A drop below $58,500 is likely to kick in the auto-liquidation engines and create a nasty red candle. 

We have seen time and again how these liquidation driven moves actually help the market to move in the opposite direction. Pushing the eager, leveraged traders to the sidelines only creates more FOMO as the market reverses and bounces. 

Will this time be any different? 

Technical Analysis

It's starting to feel a bit like groundhog day with the current technical set up. The bulls are doing their best to walk the market higher, but profit taking is slowing the pace. $64,850 is still the key level to be overcome. Should we breach, then $67,000 will be a lot easier to reach. Momentum should push us into a new ATH, especially if the Alt market continues to outperform.  

On the downside, a close below $61,750 will see the market target $60,000 and the key support area of $58,500. As mentioned above, stops below $58,500 could be the catalyst to drive the market lower, with $56,670 the first support line, ahead of $53,160.  

Market Data