Bitcoin whales playing smart or playing you? $110K floor looks suspect

Key Takeaways

Bitcoin is holding close to the essential $110k assist, attracting heavy lengthy positions from whales utilizing excessive leverage. Strategic positioning or dangerous overreach?

Bitcoin [BTC] pulled again 4.26% off its $120k native excessive, now sitting at a key inflection zone. That is the place merchants begin eyeing a backside, making a setup that might set off a textbook quick squeeze.

However perp market information suggests a crowded commerce. Over 70% of Bitcoin’s Open Curiosity is skewed lengthy. In the meantime, a whale opened a $45 million lengthy at 40x leverage round $112,854. 

That places the place about 1.28% in revenue. Since then, extra measurement has piled in with related leverage. Do these longs know one thing the remainder don’t, or are they stacking right into a liquidity entice?

Deep pockets guess large whereas the market hesitates

The market has flipped risk-off as soon as once more, with BTC coiling simply 3.5% above the important thing $110k provide wall. With spot cooling off, derivatives take middle stage, and the stakes are solely getting larger.

Regardless of a 4.26% drawdown, BTC’s aggregated OI has edged up from $79.56 billion to $79.70 billion, indicating leverage stays sticky. Coupled with a +0.0046% Funding Fee, the perp market stays skewed lengthy.

Whales are urgent the bid. Lookonchain flagged one other $3.4 million lengthy with liquidation set at $112,644, nonetheless within the inexperienced.

That is one other signal that large gamers are holding directional conviction whereas the market churns.

Supply: CoinGlass

Usually, when early longs are in revenue, it fuels copycat positioning. Binance’s 60% long-side skew reflects that herd conduct. However in a skinny market, it’s not nearly place measurement, it’s about intent.

Merely put, this type of transfer can both mark the primary leg of a “coordinated” lengthy squeeze, or a well-timed entice, baiting overleveraged longs solely to unwind right into a liquidity sweep.

Bitcoin whales exploit skinny books for slippage positive aspects

Orderbook depth on Binance confirms a skinny spot market. Purchase-side liquidity (inexperienced aspect) is shallow, with no main bid partitions providing assist. In distinction, sell-side orders (crimson aspect) are stacked extra closely.

In line with AMBCrypto, this imbalance creates splendid situations for whales to use. With some already in revenue on their longs, even a small wave of promote strain may cause sharp slippage as a result of shallow bids beneath.

As soon as Bitcoin will get pushed into these low-liquidity pockets, it units up a first-rate alternative for whales to reload on a budget, all whereas retail scrambles on the sidelines.

Supply: Binance

In present market situations, heavy lengthy positioning from whales shouldn’t be mistaken for pure bullish conviction. As a substitute, it could actually mirror a calculated liquidity play.

With Bitcoin’s spot demand nonetheless weak, it appears extra like a setup to revenue off volatility. 

Except deeper bid partitions stack up quickly, BTC’s $110k flooring may get examined, not from panic promoting, however from whales rotating quick after luring in longs.

It’s a traditional liquidity entice mechanic — One thing to maintain it in your radar.