Bitcoin (BTC) is attempting to overcome resistance at the $110,000 level this Memorial Day, but faces headwinds from selling pressure and lower spot trading volumes. Investors are closely watching market activity as U.S. markets reopen to determine if the bullish trend can be sustained.
Key Takeaways:
- Bitcoin is capped at $110,000 due to sellers and reduced spot volumes.
- Leverage is driving rallies into resistance.
- Traders eye volumes at the U.S. open on May 27 for emerging trends.
Over the weekend, Bitcoin showed a mild recovery, but sellers are limiting gains above $110,000. Glassnode data reveals ‘net distribution’ (selling) from holders of over 10,000 Bitcoin, although smaller holders continue to accumulate.
Binance’s spot and futures cumulative volume delta indicates consistent selling as BTC nears $110,000.
A futures-driven surge on Sunday, May 25, brought Bitcoin back to $110,000 following President Donald Trump’s announcement of a possible delay in EU tariffs.
Funding rates have cooled, especially at Hyperliquid, where a prominent trader closed significant leveraged positions.
Breaking the $110,000 resistance may be challenging due to the U.S. markets being closed for Memorial Day. The absence of daily open market demand from spot Bitcoin ETFs, which have purchased $8.36 billion in BTC since April, could limit upward momentum.
TheKingfisher’s liquidation heatmap suggests margin traders are heavily long, with potential liquidations below $109,000-$107,000.
CoinGlass data indicates a potential short liquidation rally to $114,000 if Bitcoin surpasses $110,000.
Traders are monitoring price action today to see if gains in futures and spot markets are followed by bullish activity when U.S. equity and crypto markets reopen.
Key price levels to watch include asks at $114,000 and $119,000 on Coinbase Pro, with bids starting at $104,000 and intensifying near $102,000-$100,000.
Bitcoin’s Current Market Dynamics
Several factors are influencing Bitcoin’s price action. The tug-of-war between large holders selling off and smaller investors accumulating creates uncertainty. Leverage plays a significant role, amplifying both gains and losses as Bitcoin approaches key resistance levels.
Analyzing the $110,000 Resistance
The $110,000 level acts as a significant psychological and technical barrier. Multiple attempts to break through have been met with selling pressure. A successful break above this level could signal further upward momentum, while failure could lead to a retracement to lower support levels.
Impact of ETF Flows
Spot Bitcoin ETFs have become a significant driver of Bitcoin demand. Their absence during the Memorial Day holiday removes a key source of buying pressure, potentially impacting the market’s ability to sustain upward momentum. The resumption of ETF activity after the holiday will be closely watched.
Liquidation Levels and Potential Price Swings
Liquidation maps provide insight into potential price swings. The concentration of long positions below $109,000 suggests a risk of cascading liquidations if the price dips below that level. Conversely, a break above $110,000 could trigger short liquidations, leading to a rapid price increase.
Looking Ahead: Key Factors for Bitcoin’s Price
- U.S. Market Open: The resumption of trading activity in U.S. markets is critical.
- ETF Flows: Monitor the inflows and outflows of spot Bitcoin ETFs.
- Liquidation Levels: Be aware of potential liquidation zones.
- Overall Market Sentiment: Track general market sentiment and news related to Bitcoin and the broader crypto market.