Bitcoin (BTC) saw a significant surge, surpassing the $28,000 mark, marking its highest price in over a month. Analysts attribute this increase to optimism surrounding ETFs and seasonal trends. Traders at Bitbank, a Japanese exchange, had already anticipated this milestone last week. The $28,500 level, which acted as a strong support level in the previous bull market, may now become a crucial resistance level to monitor in the coming weeks. Ethereum (ETH) also experienced a rise in value, crossing the $1,700 mark. Other cryptocurrencies like BNB, ADA, MATIC, and SOL also saw notable gains during this period.
The increase in bitcoin and ether prices can be attributed to short liquidations on crypto-tracked futures. Approximately $94 million in bets against rising prices were impacted, resulting in a “short squeeze.” This occurs when there is a scarcity of supply and an excess of demand, causing short sellers to buy stocks to cover their short positions. Data shows that around 30,000 bearish bets were liquidated, with most taking place on OKX, a crypto exchange. Liquidation occurs when an exchange forcefully closes a trader’s leveraged position due to insufficient funds or failure to meet margin requirements.
Traders have also highlighted the influence of historical seasonality on the recent gains. Since 2013, October has generally been a bullish month for cryptocurrencies, with Bitcoin only experiencing monthly losses twice during this period. This trend has led to the term “Uptober” being coined within the cryptocurrency community. Additionally, the crypto market was boosted due to expectations of increased demand following the proposal of a formal Ether futures ETF by VanEck, a financial giant. It is estimated that there is a 90% chance of this ETF being approved in the first week of October, according to some analysts.
