Bitcoin has risen about 24% since Monday and has already reached the upside target associated with its inverse head-and-shoulders breakout, while short sellers continue to bet against the move.
BTC climbed to roughly $79,400 on Friday, gaining 8.8% since midnight UTC as the rally that began following Wednesday’s U.S. Treasury announcement gathered further momentum. The cryptocurrency later traded just below $78,000.
The Treasury’s decision to expand its long-term bond buybacks helped extend Bitcoin’s gains. BTC has now advanced for five consecutive days, putting it on track for its strongest weekly performance since March 2023.
Crypto derivatives liquidations totaled about $3.3 billion on Wednesday, followed by another $1.25 billion over the next 24 hours, according to CoinGlass.
The Altcoin Season Index fell to 33 from 36, largely because Bitcoin dominance increased to 59.9%. That does not necessarily indicate weakness across altcoins, with ENA rising 13% since midnight and ZEC gaining 12.5%. NEAR and LINK were also up roughly 8%.
Bitcoin has now surpassed the approximately $76,000 price target generated by the inverse head-and-shoulders pattern that developed from the June lows. Traders who bought the breakout have reached that objective, which could create room for a short-term pullback, particularly with RSI signaling overbought conditions.
Derivatives Market
The Dollar Index was around 98.77, slightly below recent August highs, while Nasdaq 100 futures gained 0.43% after lagging behind the crypto market.
Total crypto liquidations fell to about $1.24 billion over the past 24 hours, down 62% from Thursday’s peak. Shorts represented approximately $1.06 billion of the total, compared with $178 million in long liquidations. In all, 152,586 traders were liquidated.
The biggest single liquidation was a $23.59 million BTC-USD position on Hyperliquid.
Bitcoin’s aggregate long-short account ratio stood at 0.865, meaning short accounts still outnumbered long accounts. Traders have attempted to fade the rally for four straight days, losing each time, leaving additional short-squeeze potential in the market.
Total crypto open interest increased 6.17% to $139.37 billion. Bitcoin futures open interest rose 7.38% to $57.7 billion, while aggregate BTC open interest reached $25.06 billion, the highest level since June.
The increase suggests traders are adding leveraged exposure as Bitcoin rallies rather than staying out of the market.
Bitcoin’s predicted funding rate reached 0.013%, potentially its highest level since January.
XRP recorded the sharpest shift in derivatives positioning among major tokens. Its 24-hour trading volume jumped 139%, while open interest rose 15.5% as the token gained 19%.
CryptoQuant’s 30-day apparent spot demand has recovered substantially, improving from negative 206,000 BTC on July 23 to around negative 5,000 BTC. The indicator is close to turning positive for the first time since Feb. 26.
CryptoQuant’s historical data shows Bitcoin has posted a median 18% gain over the following 60 days when spot demand crosses from negative to positive, with the signal succeeding 78% of the time. When the crossover occurs with MVRV below its 365-day moving average, the median gain increases to 23%, with an 87% success rate.
The firm warned that the historical sample remains small and that the latest signal has yet to complete its crossover.
CryptoQuant also found that the equivalent signal in perpetual futures demand has offered little predictive value. That puts greater importance on whether genuine spot buying continues after the current short-covering wave ends.
Altcoin Rally
Ethena’s ENA climbed 13% since midnight to around $0.132, extending its daily gain to roughly 42% and its weekly advance to about 56%.
ENA’s rally followed Wednesday’s announcement of a $1 billion secured warehouse facility with FalconX. The facility will use USDe-backed assets for overcollateralized institutional lending while reducing Ethena’s dependence on the crypto basis trade. Trading volume reached around $622 million.
Zcash gained 12.5% to approximately $640, bringing its seven-day advance to 31.5% as privacy-focused cryptocurrencies attracted fresh demand.
NEAR rose 8.6% to roughly $1.92, while Fetch.ai gained 5.59%. AI-focused tokens are beginning to participate in the rally after trailing the broader market through much of August.
Chainlink advanced 8.2% to around $11.56, pushing its weekly gain to roughly 32% and making LINK one of the strongest large-cap performers in the current rally.
