Bitcoin has recently topped $82,000, causing traders who were betting against it to suffer losses. Now observers are waiting to see whether the rebound can sustain itself, with prices potentially reaching $90,000 if it does.
On Monday, the cryptocurrency broke through $82,000 and ascended to an eight-month high of $86,000. Approximately $750 million in bearish crypto derivative positions were liquidated as the coin surpassed that level, a price ceiling that had capped prices since August, according to CoinGlass data. Shorts Got Squeezed, and Leverage Came Back
As short positions were closed, exchanges executed buy orders to wind them down. That extra demand helped push the market even higher. Jim Ferraioli, head of crypto research at Schwab, said the move came from those liquidations: “Bitcoin up 5% this morning due to short perpetual futures contracts being liquidated.”
New leveraged exposure of roughly $2 billion has been added since the breakout, according to Coinalyze data. Traders are placing fresh bets even as short positions got wiped out.
ETF Demand Flipped in a Single Week
On Tuesday and Wednesday, U.S. spot bitcoin ETFs lost a combined $746 million as the Senate failed to pass the Clarity Act cloture vote and the Fed raised rates, per data from Farside Investors. The outflows flipped fast, and the funds took in $160 million on Thursday and $433 million on Friday, the week’s strongest inflow day.
ETF investors are now making profits for the first time in a while, with the average cost basis for U.S. BTC ETF buyers at $82,225. Monday’s ETF inflow data is expected later, and traders will be watching it closely.
What Could Trip the Rally Up
Now the real test is whether spot market interest matches the shift in derivatives. Nicolai Sondergaard, senior research analyst at Nansen, said he wants to see sustained spot and ETF flows: “I want to see sustained spot and ETF flows.” Without them, this breakout could turn into a leverage-driven move that could be quickly reversed by higher government bond yields or another geopolitical shock.
When spot demand fails to catch up with fast leverage growth, the result can be highly dangerous. Crypto was hit by the most extreme form of this on Oct. 10, as bitcoin dropped from near-record prices, which triggered liquidations that fed the decline and wiped out roughly $19 billion in leveraged positions in the market’s largest liquidation cascade.
The Road to $90,000
Sondergaard, speaking for Nansen, pointed to $87,000 as the next level worth watching, followed by the psychological $90,000 mark and then roughly $92,000. Jasper De Maere, OTC Trader at Wintermute, also sees a $90,000 test as a possible outcome.
A longer-term trend line, which some traders use as a signal for their strategies, was reclaimed by Bitcoin. Wintermute’s De Maere said this measure of average price, the 50-week moving average, acted as resistance during previous bear markets.
Traders Are Watching Three Things
Over the next few days, we will be watching ETF flows closely. At the same time, perpetual futures markets show signs of excess. We will also be watching smaller blockchains for signs of activity, to see if risk appetite is broadening beyond bitcoin.
Chris Sullivan, who works as co-portfolio manager at Hyperion Decimus, sees the current run as the start of what he expects to be a new bullish cycle. He noted, however, that he expects a major dip after the rally ends. “This should be the first primary wave/rally of the new bull market,” he said, while cautioning that “we’re going to see a large correction once this rally exhausts itself.”
Wintermute’s De Maere said talk of a fresh record above bitcoin’s $126,000 October 2025 peak before year-end is still “premature at the moment,” noting that early bull markets tend to come with plenty of volatility.
| Day | ETF Flow |
|---|---|
| Tuesday and Wednesday | $746 million out |
| Thursday | $160 million in |
| Friday | $433 million in |
The pressure has proved effective up to now, but the doubt concerns its endurance.
Source material: “Bitcoin could test $90,000 after shorts get squeezed, but traders warn leverage is building,” CoinDesk.
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