Bitcoin approaches highest level since January as $85,000 sell wall clears and U.S. jobs data disappoints
Glassnode identified the next notable cluster of sell orders near $87,000, while weaker-than-expected U.S. employment data added another macroeconomic factor for the market.
Bitcoin moved above $86,000 on Friday after sellers partially filled orders around $85,000 and then removed the remaining asks, according to Glassnode. The onchain analytics firm said that left relatively little resistance immediately above that level.
Bitcoin was trading near $86,700 at the time of writing. In a Friday market note, analysts at QCP Capital said the leading cryptocurrency had broken out of the $82,500 to $85,700 range in which it had traded over the previous week. Bitcoin climbed above $87,000 earlier on Friday, marking its highest level since Sept. 23. That put the cryptocurrency 14.6% above its Sept. 15 low of $74,968 and brought it close to its strongest price since January.
Glassnode said the next concentration of sell orders is positioned around $87,000, with roughly half as much sell-side liquidity there as had been present at the previous $85,000 wall.
Resting limit orders on Binance BTCUSDT spot book. Image: Glassnode.
Bitcoin approaches September high
QCP identified resistance at $87,400 and support at $82,500, noting that bitcoin had held the lower level three times this week. The analysts described $87,400 resistance as the “gateway to $90,000.”
Bitcoin gained 12% in September, QCP said, while gold declined 8.5% during a month in which the 10-year inflation-protected U.S. Treasury yield increased by about 44 basis points and long-term inflation expectations changed very little. The firm said bitcoin’s advance appeared “more consistent with a concentrated flow trade” than with a pure currency-debasement narrative or a broad rejection of the bond sell-off. In QCP’s view, about $2.6 billion of inflows into U.S. spot bitcoin ETFs during September and the Securities and Exchange Commission’s innovation exemption were among the catalysts.
QCP said the market is now positioning for the post-election period, with options activity indicating that clients are rolling October $90,000 call options into November. That month includes the midterm elections, Treasury refunding, and the December Federal Reserve meeting.
Weaker-than-expected U.S. jobs data
Meanwhile, U.S. employers added 29,000 jobs in September, according to nonfarm payroll figures released on Friday, below QCP’s expected range of 84,000 to 93,000. The unemployment rate rose to 4.2% from 4.1%.
“Weak print strengthens the no October hike scenario, but weak is not automatically bullish: soft-but-orderly supports the liquidity trade, a growth scare pulls risk assets, bitcoin potentially included,” Sygnum Bank Chief Investment Officer Fabian Dori told The Block. “Liquidity stays the driver either way.”
Paul Howard, senior director at crypto market maker and OTC liquidity provider Wincent, told The Block that he continues to expect bitcoin to move above $100,000 by the end of the year, particularly after Citi recently revised its price target to $113,000.
“In the near term, I expect BTC to continue oscillating around the $85,000 level, but a sustained break above $90,000 could open the door to a stronger move higher, with relatively limited resistance beyond that point,” Howard said.
“Uptober is off to a strong start,” said Matt Mena, Senior Crypto Research Strategist at 21Shares. “Q4 is historically Bitcoin’s best quarter, averaging 62.7% gains, and the stage is set for a strong year-end close,” he said.
BTC price. Image: The Block.