Bitcoin Faces Liquidity Challenges as Q2 Draws to a Close

Main highlights:

• Short positions appear poised for a potential exit, analysis suggests, with a long-term resistance trend line under scrutiny.

• Fed Chair Jerome Powell is set for a successor, culminating in extremely bullish wagers on risk assets.

Bitcoin (BTC) slid towards $107,000 following the June 30 Wall Street opening as analysis focused on a significant new “short squeeze.”

BTC price rides liquidity into intense candle closes

Information from Cointelegraph Markets Pro and TradingView illustrated BTC/USD reversing its earlier gains before the weekly close, down 1.1% on the day at the moment of writing.

With only hours left until the monthly and quarterly closes, traders anticipated fluctuations, whilst exchange order-book liquidity increased.

“As BTC spot approaches $108k, we’re starting to see an accumulation of leveraged long positions as perpetual funding rates shift from neutral to positive across key exchanges,” noted trading firm QCP Capital in its recent update to Telegram channel subscribers.

“Positioning seems to be chasing the momentum, as participants engage in directional bets ahead of the quarter-end.”

Discussing probable BTC price responses, prominent X trading account TheKingisher indicated shorts facing pressure — something that would occur with only a slight increase.

“Beneath us, a cluster of long liquidations around 106k-107k. But above? A MASSIVE wall of short liquidations just above the current price, peaking sharply around 108k-108.5k!” a portion of a post summarized alongside cross-exchange liquidity data.

“That’s a strong attractor. Short squeezes can be devastating if price breaks through 107.5k.”

Furthermore, well-known trader and analyst Rekt Capital delivered mixed updates for bulls. BTC/USD now faces a crucial final resistance confrontation to unlock price discovery.

“Having surged from this local green zone of support… Price is currently retracting into this area for another evaluation,” he added regarding the daily chart.

“Ongoing stability here would allow for another challenge of the Main Downtrend from late May (black).”

Fed’s Powell successor might spark “one of the largest rallies” for stocks

As the US prepares for a quiet four-day TradFi week, optimistic crypto signals emerged rapidly throughout the day.

Related: Record Q2, monthly close next? 5 points to note in Bitcoin this week

A suggestion for a 40% crypto allocation by Ric Edelman, founder of a $300 billion fund Edelman Financial Services, along with news that Washington plans to find a successor for Jerome Powell, Chair of the Federal Reserve.

As Cointelegraph revealed, Powell continues to face public criticism from US President Donald Trump for his refusal to reduce interest rates, the latter advocating for a drop from 4.25% to just 1%.

“Should the new Fed Chair actually cut rates to 1%, we could witness potentially one of the largest runs in history for stocks and real estate,” trading resource The Kobeissi Letter predicted on that day.

“There has never been a moment in history when the Fed cut rates to 1% with stock market and home prices at unprecedented highs.”

This article does not provide investment advice or recommendations. Every investment and trading action carries risk, and readers should perform their own analysis before making decisions.