Bitcoin hits new 6-week high as Ethereum liquidates $240M more shorts

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Bitcoin (BTC) attempted to reclaim $21,000 on October 29 as trading began at a strong level over the weekend.

BTC/USD 1-hour candle chart (Bitstamp). Source: TradingView

Dollar Lies as BTC Price Rebounds

Data from Cointelegraph Markets Pro and Trading View followed BTC/USD as it hit a local high of $21,078 on Bitstamp overnight – enough to hit a new six-week high.

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After the first visit to the $21,000 mark the pair saw a consolidating phase, having traded above $21,000 for the first time since September 13.

The subsequent retracement was modest in character, with Bitcoin not even testing $20,000 before reversing once again.

BTC price action at the end of the Wall Street trading week was followed by United States equities, the S&P 500 and the Nasdaq Composite Index, up 2.5% and 2.9%, respectively, on October 28.

In his most recent Twitter update, Il Capo, a popular crypto trader and analyst, maintained an existing theory of how short-term price action will unfold.

“same same,” he Abbreviation With a chart showing potential upside and downside target levels.

BTC/USD annotated chart. Source: Il Capo of Crypto/Twitter

A cautionary macro note came from fellow trader John Wick, who warned that US dollar pressure could return to riskier assets.

“Now we look to see if we find a green dot break above the track line there,” he commented On the chart of the US Dollar Index (DXY).

“If so it’s a bad combo leading up to the Fed’s announcement on November 2nd.”
US Dollar Index (DXY) annotated chart. Source: John Wick / Twitter

Vick was referring to the Federal Reserve’s announcement next week on interest rate hikes, widely expected to match September’s 0.75% increase.

ETH Liquidations Keep Coming

It appears that there were still doubts over the bulls’ ability to generate further profits, with trader liquidations rising once again that day.

RELATED: Bitcoin’s Weak Hands ‘Mostly Gone’ as BTC Ignores Amazon, Meta Stock Dips

Data from monitoring resource Coinglass shows that the $21,000 withdrawal has burned shorts, with the tally for October 29 totaling $95 million at the time of writing.

In contrast, the day before saw only $14 million of liquidated shorts, while October 25 and 26 combined saw distributions of $661 million.

BTC liquidation chart. Source: Coinglass

“Retailer does all the same thing and wonder why it never works,” trading account IncomeShark wrote on Twitter, citing a Cointelegraph article on liquidations affecting Ethereum (ETH) shorts.

“Record shorts at the bottom, record liquidation at the bottom. Follow the herd and get slaughtered.”

The ETH short liquidation on October 29 was already at $240 million at the time of writing and was set to eclipse the previous days’ totals.

ETH liquidation chart. Source: Coinglass

The views and opinions expressed here are solely those of the author and do not necessarily reflect the views of Cointelegraph.com. Every investment and trading move involves risk, so you should do your own research when making a decision.