Bitcoin Breaks $77K as Strongest Week Since 2023 Lifts Altcoins

• Bitcoin has climbed 24% since Monday and has now reached the target suggested by its inverse head-and-shoulders breakout, while short sellers continue betting against the rally.
• BTC surged to about $79,400 on Friday, gaining 8.8% since midnight UTC as the rally that began after Wednesday’s U.S. Treasury announcement continued to accelerate. The cryptocurrency was recently trading just under $78,000.
• The Treasury’s plan to increase bond buybacks added momentum to Bitcoin’s advance earlier in the week. BTC has now posted five consecutive daily gains, rising nearly 24% since Monday in its strongest weekly performance since March 2023.
• Crypto derivatives liquidations reached roughly $3.3 billion Wednesday, followed by another $1.25 billion in liquidations during the subsequent 24 hours, according to CoinGlass.
• The Altcoin Season Index slipped to 33 from 36, largely reflecting Bitcoin’s increased market dominance, which now stands at about 59.9%, rather than broad weakness among alternative tokens. ENA gained 13% since midnight, while ZEC advanced 12.5%. NEAR and LINK also posted gains of around 8%.
• Bitcoin has moved above the roughly $76,000 target associated with the inverse head-and-shoulders pattern that developed from the June lows. Traders who entered after the breakout have now reached that technical objective, potentially increasing the risk of a short-term retracement as the relative strength index (RSI) has also moved into overbought territory.

Derivatives Positioning

• The U.S. Dollar Index stood around 98.77, slightly lower and below its August peak, while Nasdaq 100 futures gained about 0.43% after trailing the broader crypto market.
• Crypto liquidations eased to approximately $1.24 billion over the latest 24 hours, down 62% from Thursday’s peak. Short positions accounted for about $1.06 billion, compared with $178 million in long liquidations, while 152,586 traders were forced out of positions.
• The largest individual liquidation was a $23.59 million BTC-USD position on Hyperliquid.
• Bitcoin’s aggregate long-to-short account ratio is around 0.865, indicating that short-positioned accounts still outnumber those holding longs. Traders have bet against the rally for four consecutive days and have been proven wrong each time, leaving the possibility of another short squeeze.
• Open interest across crypto derivatives rose 6.17% to $139.37 billion. Bitcoin futures open interest increased 7.38% to $57.7 billion, while aggregate BTC open interest reached $25.06 billion, its highest level since June.
• The rise in open interest suggests traders are rebuilding leveraged exposure rather than remaining on the sidelines as Bitcoin advances.
• Forecast funding rates for Bitcoin have reached 0.013%, potentially marking their highest level since January.
• XRP experienced the biggest repositioning among major tokens, with 24-hour trading volume surging 139% and open interest increasing 15.5% as XRP jumped 19%.
• CryptoQuant data shows 30-day apparent spot demand has improved dramatically, moving from a deficit of 206,000 BTC on July 23 to around negative 5,000 BTC. The indicator is now close to turning positive for the first time since Feb. 26.
• Historically, CryptoQuant found that when apparent spot demand moves from negative to positive, Bitcoin has delivered a median 18% return over the following 60 days, with a 78% success rate. When the crossover occurs while MVRV remains below its 365-day moving average, the median gain rises to 23% with an 87% win rate.
• CryptoQuant cautioned that the historical sample is limited and that the signal has not yet fully turned positive.
• The firm also distinguishes between spot and futures demand, noting that a similar crossover in perpetual futures demand has historically provided little predictive value. That makes sustained spot buying especially important once the forced short covering fades.

Altcoin Moves

• Ethena’s ENA jumped 13% since midnight to around $0.132, extending its 24-hour gain to roughly 42% and its weekly advance to 56%.
• The move followed Ethena’s announcement Wednesday of a $1 billion secured warehouse facility with FalconX. The arrangement uses USDe-backed assets for overcollateralized institutional credit and reduces the protocol’s reliance on crypto basis trading. ENA trading volume has reached approximately $622 million.
• Zcash rose 12.5% to around $640, lifting its seven-day gain to about 31.5% as privacy-focused tokens attracted renewed buying.
• NEAR gained 8.6% to approximately $1.92, while Fetch.ai advanced 5.59%, with AI-related tokens finally joining the broader rally after lagging through much of August.
• Chainlink rose 8.2% to around $11.56 and is now up approximately 32% over the week, making LINK one of the strongest-performing large-cap cryptocurrencies during the rally.

About The Author

ctleditor

See author's posts