Price Resistance at $116,000
Bitcoin is facing strong resistance near the $116,000 level, with technical analysis indicating that a daily close above this threshold is required to confirm a bullish reversal. Despite a 13% rebound since the major liquidation event on October 10, persistent selling pressure has blocked breakout attempts, as order books on major exchanges like Binance and Coinbase show large sell walls at $116,000 (spot) and between $117,000–$118,000 (futures). Futures traders have begun pulling sell orders in the $115,000–$116,000 range as breakout potential increases, while $49.83 million in short positions were liquidated over the past 12 hours.
Market Structure and Investor Behavior
Open interest across global exchanges has recovered to $31.48 billion from a low of $28.11 billion on October 11, though it remains well below the peak of $40.39 billion recorded when Bitcoin reached $124,600. Spot Bitcoin ETFs have seen strong inflows, with net inflows totaling $260.23 million over the last three trading sessions, including a significant $477 million on October 21 following a dip below $108,000. According to Hyblock data, large institutional investors (trades of $1M–$10M) are taking profits on price rallies, while retail investors (trades of $1,000–$10,000) are accumulating during pullbacks. However, the composite buy-sell ratio at 10% depth on Hyblock shows a dominance of sell orders, and Binance retail trader sentiment indicates rising short positions.
Upcoming Market Catalysts
Traders are reducing risk exposure ahead of the U.S. Federal Reserve’s FOMC meeting on Wednesday, where a 25 basis point rate cut is widely anticipated. It has become common practice in the crypto market for participants to rebalance positions ahead of major monetary policy announcements. On the derivatives front, some investors expect perpetual contracts to de-risk, leading to reduced long leverage or increased shorting, which could trigger liquidations on the downside. A cluster of leveraged long positions between $112,000 and $113,000 has already seen significant liquidations.
Geopolitical Risk on the Horizon
While the FOMC decision may provide short-term direction, a more significant risk looms with the scheduled meeting between U.S. President Donald Trump and Chinese President Xi Jinping on Thursday. If trade negotiations fail to meet market expectations or result in an agreement perceived as unfavorable to the U.S. and global economy, negative spillover effects could impact both equity and cryptocurrency markets. Until these two pivotal events conclude, Bitcoin is likely to remain range-bound between the resistance level of $116,000 and support zone of $110,000.
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