Analysts predicted that BTC would likely breakout and rise towards $75,000-$80,000. A recovery in investor demand supported the outlook, but increased leverage could carry risks.
Bitcoin (BTC) price chart shows potential market structure changes and suggests a possible breakout of the $50,000 to $72,000 price range that began in March.
Analyst StockMoney Lizards said a range breakout could occur within two weeks. If so, analysts predicted that BTC could reach $75,000 to $80,000 if the recent drop below $60,000 is defended as a “higher low.”
“If this low is confirmed, we will see a breakout of this resistance within two weeks. The next target is $75,000 to $80,000.”
Source: Stock Money Lizard
To put this into context, BTC has been making new lows since August, a price action trend that signals a potential market structure change, especially if it is preceded by a high.
Rising demand and risks
Investor appetite for the world’s largest digital asset also improved, suggesting a slow but steady recovery in demand in the fourth quarter compared to the second and third quarters.
Looking ahead, BTC demand has been negative since May, with selling outweighing buying. However, CryptoQuant noted that the pace of imbalance has eased.
Source: CryptoQuant
In fact, the apparent demand for BTC measured over the past 30 business days shows that investor demand has reached levels last seen in May.
About 150,000 BTC (worth about $9.4 billion) was grabbed by investors from late September to mid-October.
Source: CryptoQuant
Therefore, if this pattern expands over the next two weeks, rising demand could support the Stockmoney Lizards breakout prediction.
However, the rise in leverage, indicated by the rise in open interest (OI), also brought an impending pitfall to breakout hopes.
For those unfamiliar, rising leverage meant speculators took on more risk by borrowing money to open positions in BTC in the futures market.
According to Glassnode, the recent weekend rally from $58.9,000 to $63,400,000 caused some short sellers to flush out ($2.5 billion in OI).
Source: Glassnode
However, the analysis firm also notes that the decline in OI did not exceed 5%, a level that historically has always been a point that prolongs Bitcoin’s rally.
This means increased volatility and liquidation risk on either side of the price direction, potentially derailing breakout expectations.
Meanwhile, BTC’s value was $62.8 million, trading below its 200-day moving average (MA) at the time of writing.
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