Everyone Is Waiting for $75k. That Is Exactly the Problem.

The headlines are negative. Tensions in the Middle East could escalate further, ETF outflows are building, and well-known Bitcoin sceptic Peter Schiff has flagged $75k as the next stop, warning it was “going to be a very long weekend for Bitcoiners.” With all that, you might expect Bitcoin to be a lot lower than it is. On Saturday it dipped to around $79,150, then bounced back towards $80,800. It is still sitting at $80k.

Schiff isn’t alone. $75k has become the most popular downside target online, and a few people are calling for $72k. So let’s break down whether those levels hold up, and what actually matters this week.

The Levels That Matter

$75k is a valid level. In our Q4 Outlook, our key level was $74.9k. That is the previous higher low, and it is where Bitcoin’s bullish structure gets tested on the higher time frame. It isn’t just our level either. The short-term holder cost basis sits around $74.6k. Strategy’s average cost per Bitcoin is reported at $73,981. If $75k does arrive, it arrives at a level with plenty of reasons for buyers to step in.

Before that, there is the True Market Mean at around $77.5k to $77.6k, which is the average cost basis of active investors.

ETF Investors Under Pressure

Glassnode puts the average entry price of US spot Bitcoin ETF holdings at about $81,500. It puts the average for corporate treasuries at $80,200. With Bitcoin under both, the average ETF holder is now underwater. Around $773 million has left US spot Bitcoin ETFs over two days. Because these funds can’t trade over the weekend, holders have had to sit through the dip. When ETF trading resumes on Monday, we will find out whether they fold or double down.

Where the Pain Sits

Much of the leverage to the downside has already been cleared out. Longs made up 82.8% of the $837 million liquidated in the last 24 hours. What is left now leans heavily one way.

Source: https://www.coinglass.com/pro/futures/LiquidationMap

With Bitcoin around $80k, a 1% move higher would liquidate roughly $800 million in shorts, rising to about $1.2 billion by $84.3k. Each liquidated short is a forced buy, which can push price into the next batch.

The downside looks very different. A similar move lower, to around $79.7k, would liquidate only about $200 million in longs. Bitcoin would need to fall to around $78.2k before long liquidations reach the same $800 million.

Put simply, a 1% move up would cause around four times the pain of a 1% move down.

FOMC and Options Expiry

This is a big week. The Fed meets on 27 to 28 October, with the rate decision on Wednesday at 2pm ET. That is 5am Thursday here in Melbourne. The Fed raised rates to 3.75% to 4.00% in September, saying inflation remains elevated. Any hint of another hike will hit risk assets. A hold would likely be a relief.

Two days later comes the biggest options expiry on Deribit’s calendar. On 30 October, $11.1 billion of Bitcoin options expire. That is 34.6% of Deribit’s open interest, with a put/call ratio of 0.56. That expiry is 7pm Friday in Melbourne.

Max pain for this expiry sits at $78k. Max pain is the price at which the greatest number of options would expire worthless. In other words, it is where option buyers as a group would lose the most and option sellers would pay out the least. It is not a price target. Studies on traditional markets show no reliable link between max pain and where price actually settles. But when this much money expires at once, price can drift towards that level in the days beforehand. The single largest position is the $95k call, a bet that Bitcoin will be well above where it is today.

Why Waiting Rarely Pays

Bitcoin could easily revisit the mid $70ks, or go lower. But we have spoken about the greed of trying to snipe the bottom many times. We saw it in the bear market. When Bitcoin was taking stabs below $60k, people waited for $55k. When it bounced to $65k, they waited for sub $60k again. It never came.

This could easily be more of the same. If most people are expecting $75k or lower, do you really think it will arrive on schedule? Bitcoin has a habit of doing the opposite of what the crowd expects.

Look at the maths. Waiting for $75k from $80k saves you about 6%. If that level never comes and Bitcoin recovers to the $85k to $87k zone, you have missed around 9%, and that is just the first resistance. Against the levels in our Q4 Outlook, the miss is much bigger. You give up the chance of being positioned to save a few percentage points. That trade is not worth making.

There is also a middle ground. Anyone worried about timing does not have to choose between all in now and nothing at all. Spreading an entry over time takes the pressure off picking the exact bottom. Your Stormrake broker can talk you through what fits your situation.

The crowd is waiting for $75k. History suggests the market rarely gives the crowd what it wants.

---

Stormrake Spotlight: Zcash (ZEC) ($1,217)

Source: https://www.tradingview.com/x/EtEGYCaq/

A quiet weekend by ZEC’s standards, up a couple of percent as it ground higher. It continues to hold above its key moving averages, which are acting as support and giving the bulls a platform to push higher. The question is how the broader market reacts this week, and how much that drags on or lifts ZEC.

---

BTC/USD Key Levels and Price Action:

Source: https://www.tradingview.com/x/6WtJDeh2/

It’s been a weekend of grinding around $80k for Bitcoin. We saw a brief stab below it, but price has since reclaimed the level. Despite the reclaim, the short-term picture remains bearish, with momentum and structure in the bears’ favour. The question on everyone’s lips is how far this pullback will go. With the Fed on Thursday morning and a major options expiry on Friday, this will be a telling and volatile week.

---

*All prices are denominated in USD unless stated otherwise*

---

Written by Alexandar Artis