Bitcoin’s price was hovering around $113,000 on Monday following a weekend of significant liquidation that wiped out over $1 billion in leveraged long positions. Derivatives and macro indicators are now key factors influencing the next market move.
The spot price is currently around $112,965, approximately 10% lower than its recent peak. This comes as the market processes the Federal Reserve rate cut from last week and an increase in volatility.
The reset began with futures trading, where forced unwinding led to a reduction in long exposure across major platforms. Over the weekend, more than $1.6 billion worth of long positions were liquidated, resulting in a decrease in open interest levels across Binance, Bybit, and CME.
Data from Coinglass’ dashboards indicates a retreat in BTC futures open interest, funding moving towards neutral levels for key perpetual contracts, and liquidation heatmaps clustering above and below the spot price.
Options Market Reacts
Analytics from Deribit and Laevitas show that short-term put options are trading at a premium compared to calls—a trend consistent with increased demand for downside protection. Dealers are leaning towards short gamma near the current spot price. This profile tends to amplify intraday fluctuations when the spot price is within negative gamma zones but stabilizes when gamma turns positive.
Market flows are not one-directional. According to Farside Investors’ data on US spot ETFs for September 17th-18th saw mixed net flows—$51 million outflow followed by roughly $385 million inflow before the weekend—indicating potential impact on immediate momentum but maintaining medium-term support if overall inflows resume.
Basis and term structure analysis provide insights into Q4 health checkup. CryptoQuant’s CME annualized basis series reflects easing carry demand from arbitrage capital since mid-September—an indication of cleaner positioning trends which could change rapidly if leverage increases during any rebound.
Macro factors continue to play a role at this juncture with US 10-year Treasury yields hovering near low-4% post-Fed rate cut while Dollar Index strengthens entering new week—conditions that may exert pressure on crypto beta if sustained over time.
According to MarketWatch data showing 10-year yield at around 4.1%, alongside strengthening Dollar Index amid cautious equity futures—a tactical headwind for rapid upside movement though its impact tends to be sporadic given position-driven nature of crypto markets.
Potential Scenarios
Scenario A: A rebound squeeze could push prices towards $118k-$124k range overlapping with upside liquidation clusters shown by Coinglass heatmaps along common gamma friction points near round figures.
Trigger conditions include flat or lower funding rates during green days; mild increase in outright shorts; movement towards neutral skew; steady-to-positive ETF flows over multiple sessions converting residual open interest into upward momentum until protective gamma kicks-in.
Scenario B: Another sell-off before recovery might test support levels between $104k-$108k where liquidity pools thicken below recent lows—with risks of persistent negative skew while ETF flows remain weak amidst firm Treasury yields & Dollar Index.
Under this scenario: Funding rates turning neutral/negative during red days across major platforms; implied volatility staying bid as dealers maintain short gamma below $115k keeping downside path dependence active until further reduction in open interest or shift in options inventory dynamics.
Institutional Activity Insights
CME’s bitcoin futures platform offers deep liquidity & consistent participation serving as reference point for institutional activity especially during quarterly options/futures roll-offs.
A decline in CME basis coupled with stable open interest suggests normalization without widespread deleveraging whereas significant drop-off would confirm broader market reset underway.
Seasonality & Recovery Paths
As October approaches seasonality trends come into focus—Coinglass monthly return tables indicate historically positive median returns during October (“Uptober”) suggesting higher odds favoring recovery paths post sharp September corrections especially when combined with improved derivatives stack.
What matters now is whether excessive leverage has been sufficiently reduced allowing natural trading movements without undue influence.
Coinglass data shows large remaining open interest despite recent flush; moderated yet stable funding rates; actionable clusters within +/-5%-8% range indicating ongoing market uncertainty.
Farside’s mixed ETF ledger suggests no clear directional bias while CryptoQuant’s basis series remains under scrutiny alongside continued put-skew dominance signaling potential shifts based on evolving market conditions.
The immediate outlook hinges upon position signals:
If funding remains low/near zero along with positive ETF prints over several sessions coupled with rising short-gamma pockets due normalizing skew—a push toward$124K becomes likely outcome.
However if Treasury/Dollar stay strong amidst negative skew/weak ETF flows then pressure mounts testing support at$108K first.
Traders monitoring same dashboards will quickly discern unfolding scenario paving way forward.