Bitcoin (BTC) experienced a period of reduced volatility on October 6, as the price of BTC remained relatively stable. After an unsuccessful attempt to retest the $28,000 level, the largest cryptocurrency traded within a narrow range, about 1.5% lower. However, there were concerns among market participants about potential losses in the future.
Trader Daan Crypto Trades observed a tug-of-war between two key moving averages (MAs) on the one-day timeframes. The outcome of this battle between the Daily 200MA and the Daily 200EMA would likely determine the trend for the rest of October. Daan Crypto Trades highlighted the $27,000 and $28,000 levels as the key price zones to watch.
Daan Crypto Trades also noted an increase in open interest (OI) across exchanges, which could lead to a squeeze of short positions followed by long positions. This pattern has often resulted in a short squeeze to the upside and then a long squeeze to the downside. Monitoring resource CoinGlass reported minimal liquidations in both long and short BTC positions on October 6.
Another monitoring resource, Material Indicators, focused on the trading behavior of whales throughout the week. It classified whales into different categories based on the volume of their trades and observed contradictory moves among them. Whales with orders worth between $100,000 and $1 million, which are considered the main drivers of spot price action, increased their exposure but failed to initiate a broader uptrend. Meanwhile, other whales sold a significant amount of their holdings, leading to speculation about whether this was related to the liquidation of assets from defunct exchange FTX.
In terms of exchange-based setups, trading account Exitpump detected a potential liquidity grab being prepared below the $27,400 level. It noted that price tends to interact with resistance levels multiple times before forming a top.
Overall, despite the relatively stable price action, there were concerns about potential losses and conflicting moves among different groups of market participants. The lack of significant downwards movement in BTC price was considered a surprise. It is important for readers to conduct their own research and analysis before making any investment or trading decisions.