Bitcoin Faces Key Test At $106k

Bitcoin is back at a critical price level of $106,400, a key pivot point for recent rallies and pullbacks. Acceptance above this level has historically triggered further gains, while rejection has led to price rebuilds. A clean daily and weekly close above $106,400 could convert the level from resistance to support, potentially opening the way for a move toward $114,000 to $120,000.

However, failure to sustain gains above $106,400 could keep the $126,000 peak in control and lead to a retest of $100,000 or lower. Recent investment product flows have been mixed, with roughly $946 million in net outflows during the week ending November 3, following heavy inflows the prior week. Daily exchange-traded fund (ETF) creation prints have also been inconsistent.

Derivatives positioning also plays a crucial role. Options open interest on Deribit reached a record $50.27 billion on October 13, with significant put interest clustered around $100,000, potentially capping upside and pinning prices near round strikes.

To confirm a bullish reversal, sustained ETF inflows over 5-to-10 days and a shift in options skew toward calls are needed, in addition to a hold above approximately $126,272. Otherwise, rallies will likely be considered distribution.

As of 10:15 am UTC on November 10, 2023, Bitcoin is trading at $106,354.45, up 4.71% over the past 24 hours, with a market capitalization of $2.12 trillion.

Disclaimer: What is written here is not investment advice. Cryptocurrency investments are high-risk investments. Every investment decision is under the individual’s own responsibility.