Bitcoin recently broke past the $85,00ousand level following a 42% Q3 rally that has positioned the asset for its historically strong fourth quarter. According to data from Glassnode, the sell wall above Bitcoin has largely disappeared after buyers cleared the $85,000 threshold following nearly a week of failed attempts. With less near-term liquidity sitting above the asset, the road higher could allow for faster price movement if buying accelerates.
Macroeconomic factors are also contributing to the shift. FedWatch data indicates that rate hike odds dropped from 70% to 26% as expectations of a pause increased, pointing to a potentially more liquidity-friendly setup. Additionally, CoinGlass data showed Bitcoin's long/short ratio rising above 1, indicating increased long positioning by traders alongside easing macro uncertainty.
Despite these bullish technical and macro indicators, questions remain regarding the strength of spot demand. U.S. Spot Bitcoin ETFs recently recorded net outflows, ending a previous inflow streak. On Wednesday, these funds saw $148.7 million in net outflows, led by Fidelity's FBTC with $125.6 million in exits, while BlackRock's IBIT saw $9.5 million in outflows.
Furthermore, Coinbase data reveals that $136.72 million in BTC spot sell orders are stacked between $89,000 and $109,000. Analysts note that this overhead supply could act as resistance if spot buying stays weak, potentially turning the $85,000 breakout into a fakeout if stronger institutional demand does not materialize to support the derivatives sentiment.
