The Bitcoin market saw a moderate price recovery over the past week, following a prolonged period of price correction that began in early October. The flagship cryptocurrency is now trading above $90,000, with hopes growing of a possible return to the all-time high of $126,100.
Notably, popular market analyst KillaXBT has highlighted a key price zone that could serve as the next target in this easing market recovery.
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Bitcoin heads to $95,000-$96,000, but price drop could happen first – analyst
In one X message on November 28, KillaXBT shares some compelling insights on Bitcoin’s price state, highlighting both bullish and bearish trends. After the 7.22% price increase over the past week, the analyst predicts that market bulls are likely to push prices to around $95,000-$96,000, which contains strong, heavy illiquidity areas and several liquidation clusters.
Given the context, these zones are attractive price-wise because they contain large concentrations of rest orders, making them valuable liquidity targets. Liquidation clusters in particular have groups of leveraged positions that trigger forced buying or selling once the price reaches it, injecting new liquidity into the market.
However, KillaXBT cautions that this upward move may not happen immediately, noting that the market often postpones major liquidity zones ahead of major macro events. With the upcoming Federal Open Market Committee (FOMC) meeting expected to provide clarity on potential rate cuts, near-term traders may see continued liquidity build-up below the annual open.
According to the analyst, these higher liquidation levels are still likely to be lifted, but the timing could align more closely with next month’s policy announcement rather than the current market cycle.
The analyst outlines a potential scenario where Bitcoin experiences a small pullback to around $93,000 before retesting $89,200. From there, the asset could move toward the $95,000-$96,000 target, in line with expectations for a possible FOMC rate adjustment.
However, KillaXBT also highlights the possibility that Bitcoin could reach these key liquidation zones before the FOMC meeting. In such a scenario, the market could see a rapid rise to $96,000, followed by a sharp decline to around $89,200 due to possible liquidations, before eventually returning to these higher liquidity zones.
Following this analysis, KillaXBT chooses to take a short position, which it plans to reassess against market trends as the FOMC approaches. Interestingly, the analyst believes that the real near-term opportunities will only emerge after the FOMC announcement.
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Bitcoin price overview
At the time of writing, Bitcoin is trading at $90,490, reflecting a slight decline of 0.64% in the past day.
Featured image from PixelSquid, chart from Tradingview