Could a Short Squeeze Boost Bitcoin to $100,000?

The cryptocurrency market is at a critical stage, with Bitcoin (BTC) and Ethereum (ETH) being the main characters in the discussions. After a period of high volatility, Bitcoin recorded its first weekly decline since the end of October.

Investors and analysts are therefore evaluating whether BTC can recover the $100,000 level and whether ETH will be able to surpass $4,000 again.

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Bitcoin is suffering from selling pressure and is at risk of a short squeeze

Currently, Bitcoin is facing a scenario of selling pressure. Despite this, experts indicate that a “short squeeze” movement could push the price up, reaching six figures again.

The term “short squeeze” describes a situation in which short sellers are forced to buy back the asset, driving the price up abruptly.

Recent data indicates that selling activity in the BTC market has increased. This creates conditions for a potential price spike if a recovery is initiated.

In addition, growing institutional adoption and strengthening market sentiment could act as catalysts for Bitcoin to reclaim its all-time high.

Ethereum holds $3,200 support

Ethereum, the second-largest cryptocurrency by market cap, has also been attracting attention. Currently priced below $4,000, ETH is facing challenges but is showing resilience due to the continued growth of its network.

Although it has been trading lower over the weekend, the price of Ethereum has been showing a correlation with Bitcoin. Analysis of the daily chart reveals that ETH is forming a bullish reversal candle. Furthermore, the RSI is hovering near the 50 level, still far from the oversold threshold.

In addition, Tron founder Justin Sun sold $143 million worth of ETH last week. The sale contributed to a 15% drop in the price of Ethereum.

However, analysts believe that Ethereum’s ability to attract developers and innovative projects will be key in determining its trajectory.

While both assets face significant challenges, cautious optimism prevails in the market. Recovery to these milestones will depend on a combination of macroeconomic, technical, and investor sentiment factors.

However, the potential for a return to all-time highs keeps investors on their toes in a crypto market that promises surprises.

Thiago Barboza

Thiago Barboza has a degree in Communication with an emphasis on creative writing from the Federal University of Bahia (UFBA). In 2019, he learned about cryptocurrencies and blockchain, but it was in 2020 that he decided to dive headfirst into the crypto universe. In 2021, he joined the BeInCrypto team, and over the course of 3 years, he has published more than 1,500 articles covering the most diverse sectors of the cryptocurrency, blockchain, and Web3 markets.

Disclaimer

The information provided in this article is for informational purposes only and reflects the author’s opinion. It should not be construed as financial, legal, or investment advice. The cryptocurrency market is volatile and carries risks. Please conduct your own research before making any decisions.

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