Bitcoin's Volatile Day: Key Liquidation Levels Signal Potential Breakout

Yesterday was one of the most volatile days we've seen for Bitcoin in a while, with multiple 2+% moves up and down, shaking out both bulls and bears, and liquidating long and short positions in the process.

When liquidations occur, positions that once provided support or resistance for Bitcoin vanish. As the liquidation heatmap shows, there is a significant volume of leveraged positions at $62,500 and $64,750. If Bitcoin reaches these levels, those positions will be wiped out. Should BTC break below $62,500, we could expect a further drop toward $60.1k, while a break above $64,750 could push BTC up to $66k.

With nearly a 4% range between these key liquidation levels, Bitcoin is likely to remain volatile, using these areas as critical support and resistance. If leveraged longs are wiped out, it could present a buying opportunity, as it may only be a matter of time before the higher-level shorts are liquidated.

Stormrake Spotlight: WIF ($2.61)

DOGWIFHAT (WIF) is one of the big dogs of the memecoin sector. You might be wondering why I've shifted focus from projects like SOL, ETH, and FTM to a meme coin. Well, this isn't just a teaser for the upcoming 'Thunder Trading' article that will be released later this week, memes play a significant role in the cryptocurrency ecosystem. Despite being less than a year old, WIF has established itself as a staple in the memecoin space, with a 70% price rise over the past 30 days. However, it remains 50% below its all-time high set in March of this year. Still considered a small-cap asset with a market cap of just $2.6 billion, WIF has the potential for significant growth during a bull market. Memecoins can be rocket fuel for a crypto portfolio, but understand that with the potential for increased upside comes a sharp increase in volatility and risk. If you're unsure about how much to allocate, consult your dedicated Stormrake Crypto Broker.

BTC/USD Key Levels and Price Action:

As anticipated, Bitcoin reached the key resistance level of $63.8k, testing it twice within the past 24 hours. BTC failed to break it on the first attempt, retracing 2% before bouncing off the confluence of moving averages. It briefly broke above, reaching a high of $64.5k, where bears defended the level, pushing BTC back down to the 55-EMA at $62.7k before bouncing again to the current level of $62.3k. The momentum favors the upside, so we can expect another retest of the $63.8k resistance. Any pullbacks should be viewed as buying opportunities, as long as BTC remains above its moving averages.

BTC Total ETF Flows for 7 Oct: $ N/A

ETH/USD Key Levels and Price Action:

While Bitcoin is actively retesting resistance, Ethereum continues to struggle with its moving averages and CPR levels. The key level for ETH remains $2,556, but it will only reach this if it can clear the numerous moving averages acting as barriers. While ETH remains bullish versus the USD, it is underperforming against Bitcoin. Until this trend shifts, BTC may offer better opportunities than ETH. Downside support for ETH stands at $2,260.

ETH Total ETF Flows for 7 Oct: $ N/A

Written by Alexandar Artis

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