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Bitcoin is exhibiting indications of resurgence after facing weeks of selling pressure, which peaked in a steep flash crash on October 10, when the price momentarily fell to approximately $103,000. Since that event, BTC has seen a modest recovery, currently testing resistance around $111,000, a region historically frequented by sellers. Despite this rebound, market sentiment remains delicate, with traders reluctant to declare a definitive bottom.
Leading analyst Darkfost suggests that Bitcoin might be transitioning into a new disbelief phase — a season often observed at the conclusion of significant corrections, when investors find it hard to believe any signs of rebound. This transformation is becoming increasingly apparent in the derivatives market, especially through funding rates, which indicate trader positioning and market sentiment.
On Binance, which continues to lead in global futures trading volume, funding rates have stayed negative for six out of the last seven days, presently hovering around -0.004%. This ongoing bearish stance implies that short positions continue to dominate over longs, as traders proceed with caution following the recent liquidation wave. Historically, such enduring disbelief and short dominance have frequently preceded substantial short squeezes or relief uptrends.
Disbelief May Pave The Way for The Upcoming Major Surge
As per Darkfost, the current period of disbelief could ironically serve as the groundwork for Bitcoin’s next significant surge. When traders remain excessively bearish despite early indications of recovery, the build-up of short positions can create conditions for a potent short squeeze. In such circumstances, even a slight upward movement can compel short sellers to close their positions, amplifying buying pressure and triggering a swift price breakout.
If the current upward trend continues to gather strength, this surge of liquidations could propel Bitcoin significantly higher. Darkfost highlights essential liquidity zones around $113,000 and $126,000, both locations currently housing substantial short positions. As these positions unwind, BTC could experience a chain reaction of forced buying — a dynamic that has historically inspired explosive movements.
Similar trends have manifested previously. In September 2024, Bitcoin dropped to $54,000 before rebounding above $100,000 for the first occasion, fueled by a significant short squeeze. Once more, in April 2025, BTC skyrocketed from $85,000 to $111,000, and eventually to $123,000, adhering to the same pattern.
Darkfost implies that the market could presently be entering another such disbelief stage, where pervasive skepticism conceals underlying strength. If history repeats, this doubt-laden environment may once again convert fear into momentum — positioning the ground for Bitcoin’s next significant upward movement.
Bitcoin Discovers Temporary Support, Aims for $113K Resistance
Bitcoin is displaying signs of stabilization following a tumultuous week, bouncing back from its recent low near $106,000 to trade around $111,200. The chart indicates BTC is recovering short-term momentum, with buyers emerging near the 200-day moving average (red line), a crucial long-term support zone that has historically indicated accumulation phases during corrections.
Nevertheless, BTC is now up against a significant challenge. The 50-day (blue) and 100-day (green) moving averages are coming together near $114,000–$115,000, forming a dense resistance cluster. A successful breakout above this zone would indicate renewed strength and could potentially unlock the route toward $117,500, the next vital liquidity zone and psychological hurdle for bulls.
Conversely, failing to maintain a position above $110,000 could expose BTC to fresh selling pressure, potentially retesting the $106,000 or even the $103,000 level experienced during the October 10 flash crash. The current structure implies that the market remains in a recovery and disbelief stage, where traders continue to be wary despite improving price movements.
At present, the primary focus is on whether BTC can maintain momentum above the 200-day moving average. A confirmed daily close above $113,000 would bolster bullish confidence and affirm the initiation of a potential short-term turnaround.
Featured image from ChatGPT, chart from TradingView.com
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