Bitcoin Price Forecast: BTC reaches $80,500 amid rising short liquidations

• Bitcoin’s recovery gathers pace above $80,500 on Thursday, following a close above key EMAs a day earlier.
• Short positions accounted for 70% of the more than $700 million in positions liquidated over the past 24 hours.
• A modest $74.57 million inflow into US-listed spot ETFs on Wednesday ended a run of three consecutive days of outflows.

Improving sentiment and renewed buying interest are supporting Bitcoin’s (BTC) rebound above $80,500 on Thursday, after it closed above key Exponential Moving Averages (EMAs) a day earlier. A short squeeze has accompanied the recovery, triggering nearly $800 million in liquidations over the past 24 hours. Institutional demand has also shown tentative improvement: spot Exchange Traded Funds (ETFs) attracted $74.57 million on Wednesday, ending three consecutive days of outflows. Together, these developments could help sustain the Crypto King’s recovery.

How is US political gridlock supporting risk assets?

Uncertainty eased after the closely watched US midterm elections delivered Democratic victories in both the House and the Senate. The result also reduced expectations of US President Donald Trump resuming military strikes against Iran. 

On Wednesday, Senate Democratic Leader Chuck Schumer pledged to seek an end to the Iran war, saying his party could leverage its control over government funding to pursue that objective. 

Crude oil prices have fallen on this optimism, helping ease inflation concerns. West Texas Intermediate (WTI) is trading around $87 on Thursday, at levels last seen in early September.

Risk assets are also benefiting from expectations that fiscal gridlock in Washington could further constrain government spending. Those expectations have weighed on US bond yields and kept the US Dollar (USD) under pressure, helping BTC regain the $80,500 level.

What drove liquidations above $700 million?

The Coinglass chart below puts liquidations over the past 24 hours at $794.30 million, as BTC saw the elevated volatility discussed in the previous report. 

Shorts made up 70% of the liquidated positions, indicating that leveraged bearish traders bore the brunt of BTC’s rise above $80,000. Forced closures of these short positions may have added to buying pressure and quickened the Crypto King’s recovery.

Can modest ETF inflows support the recovery?

Tentative optimism is emerging in institutional demand for BTC, with SoSoValue reporting modest inflows of $74.57 million into BTC spot ETFs on Wednesday. This ended three consecutive days of outflows. A continuation and strengthening of inflows through the rest of this week could support a further recovery in BTC.

Bitcoin technical outlook: Can gains above key EMAs hold?

Holding above its 50-day, 100-day and 200-day Exponential Moving Averages (EMAs), Bitcoin retains a positive bullish bias at $80,777 on Thursday. These averages stand at $80,172, $77,904 and $76,547, respectively, a configuration that indicates the broader uptrend remains intact. Meanwhile, a Relative Strength Index (RSI) reading of 51 and a newly positive Moving Average Convergence Divergence (MACD) histogram point to a recovery in bullish momentum, rather than overbought conditions.

Should the advance continue, horizontal resistance at $85,000 represents the next major obstacle and a potential area for profit-booking.

The first downside support lies around the 50-day EMA at $80,172. Below that, the 100-day EMA near $77,904 and the 200-day EMA at $76,547 provide further support. BTC’s bullish outlook is likely to hold while the price stays above this layered EMA support zone.

(The technical analysis of this story was written with the help of an AI tool. Know more.)