Key takeaways:
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Bitcoin volatility is expected to remain present ahead of Fed Chair Powell’s speech on Friday.
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Analysts say Bitcoin’s dip below $112,000 offers a “great entry” opportunity for traders.
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BTC price may drop as low as $110,000 if key support levels are broken.
Bitcoin (BTC) has been trending down alongside the broader crypto market since Aug. 14, dropping to a 17-day low below $112,500 on Wednesday. With Federal Reserve Chair Jerome Powell’s Jackson Hole speech expected on Friday, markets could see volatile price swings toward key BTC price levels over the next few days.
Bitcoin price key “accumulation” level sits near $112,000
A break below the $115,000 support level was what traders needed to decide whether to add or reduce exposure.
MN Capital founder Michael van de Poppe spotted Bitcoin hovering at $113,700, saying that the price has reached a “potential area of interest for longs.”
An accompanying chart suggested the area between the August low at $111,900 and the $113,000 psychological level was a key level to watch in BTC’s six-hour time frame.
Related: Bitcoin sell pressure ‘palpable’ as BTC bid support stacks at $105K
A dip below this zone would provide traders with a “great” opportunity to buy more at a discount, van de Poppe said, adding:
Similar sentiments were shared by fellow analyst AlphaBTC, who said that Bitcoin’s price was likely to revisit the monthly low at $111,980 before making a “bigger squeeze back up.”
Lower than that, $110,000 is an important level to keep an eye on, an area that has supported BTC price since July 10, according to trading firm Swissblock. It lies within a key demand zone defined by the 100-day simple moving average (SMA) at $111,000 and $105,000.
As Cointegraph reported, Bitcoin’s key support level remains $100,000, which is embraced by the 200-day SMA and acts as the last line of defense for the bulls.
On the upside, Bitcoin must flip the area between $116,000 (50-day SMA) and $120,000 into support to secure the bull run. This would increase the chances of revisiting the all-time high above $124,500 or higher into price discovery.
Will liquidations drive BTC below $110,000?
Several traders eye a potential downward liquidity grab with bid orders extending to $110,000.
The latest data from monitoring resource CoinGlass showed price eating away at around $113,000, with the bulk of interest clustered below $112,000. More than $110.4 million bid orders were sitting between $111,000 and $110,000.
To the upside, however, ask orders were building up, with the bulk of liquidations sitting between $115,800 and $118,100.
If the $118,000 level is broken, it could spark a liquidation squeeze, forcing short sellers to close positions and driving prices toward $120,000, which is the next major liquidity cluster.
“The biggest cluster in close proximity now sits at around $120K and of course, the local range low at $112K is still in play,” said Bitcoin trader Daan Crypto Trades in an X post on X, adding:
As Cointelegraph reported, increased selling by Bitcoin short-term holders could heighten the odds of BTC price dropping toward $110,000.
This article does not contain investment advice or recommendations. Every investment and trading move involves risk, and readers should conduct their own research when making a decision.
Source: https://cointelegraph.com/news/bitcoin-eyes-liquidity-at-dollar110k-watch-these-btc-price-levels-next?utm_source=rss_feed&utm_medium=feed&utm_campaign=rss_partner_inbound
