Bitcoin surged to $85,111 on Monday, posting a 5.7% gain over the past 24 hours and breaking through a resistance zone that had capped price action over the past week. The sudden upward momentum liquidated $648 million in short positions from traders betting on a decline during this short squeeze wave.
The move past $85,000 marks a continuation of upward momentum after Bitcoin was previously range-bound between $81,300 and $84,000. A trend reversal began to take shape right as the price crossed $80,000, marked by spot market volumes flipping from net selling to net buying. Large wallets that had consistently unloaded assets throughout August shifted their strategy to become net buyers late in the month, adding to their holdings on September 20 at the fastest daily pace seen in weeks.
Sell the Rumor, Buy the News
Over the past week, Bitcoin price action had to absorb the Fed’s interest rate hike, the Bank of Japan’s rate setting to a 31-year high, and the rejection of the Clarity Act bill in the US Senate. Despite facing a barrage of heavy headwinds, the asset’s price never dropped significantly below $75,000.
Market analysts characterized the price resilience at the $75,000 mark as a classic “sell the rumor, buy the news” scenario. Most de-risking efforts and safe-haven repositioning had already been completed by traders before the Clarity Act vote and the Fed’s decision were finalized. HashKey’s Tim Sun argued that the anticipated rate hike effectively cleared a layer of uncertainty, noting that a clearer macroeconomic outlook was the primary prerequisite sparking Bitcoin’s rally.
External Pressures Ease
Various external macroeconomic pressure indicators have also continued to ease. The 10-year US Treasury yield, which briefly hit 5.014% on September 14 - its highest level since October 2023 - gradually cooled down to 4.93%. The 2-year yield also settled at 4.67%. Nexo analyst Iliya Kalchev highlighted smooth Middle Eastern oil exports running well ahead of expectations, dragging benchmark Brent crude prices down to a two-week low.
Traders’ focus has now shifted to international diplomatic agendas. The market is pricing in the possibility of talks between US and Iranian representatives on the sidelines of the UN General Assembly this week. US and Chinese officials are also scheduled to meet in New York to prepare for the Trump-Xi summit on September 24.
Holding the $75,000 line through intense macroeconomic storms is now paying off. With external pressures easing and spot buying volume returning, market momentum left only one path for Bitcoin, leaving a wave of liquidations in its wake.
Reported by Decrypt.
Also read: How to Read Candlesticks for Beginners
Previously: Bitcoin Sweeps $445 Million in Short Positions to $81,300 - But $83,000 Resistance Awaits as a Real Test
Disclaimer: This article is for informational and educational purposes only, not financial advice. Cryptocurrency assets are highly volatile and carry significant risk. Always do your own research (DYOR) and never invest more than you can afford to lose.
