Bitcoin has surged significantly over 94,000 USD. The price had previously remained stable for several days between 88,000 USD and 92,000 USD. The rise came quickly on December 9. It increased within minutes and broke out of the price range that had held the market back for almost a week.
Whales are buying more and short positions are being liquidated – this drives the rise
Trading data shows that large institutional wallets and wallets linked to exchanges received a lot of capital in the hour before the rise.
Several large wallets managing others' assets accumulated thousands of BTC in a short time. This means that buyers with substantial capital acted first before the market began to push prices upward.
The speed of the rise indicates that the order book quickly thinned as buyers broke through the resistance zone. There was a sharp change in the market, and pressure increased as those who bet against rising prices sought to close their positions.
Liquidation data shows that the futures market reacted immediately. Over 300 million USD were liquidated in the crypto market over the past 12 hours. Bitcoin accounted for more than 46 million USD and Ethereum over 49 million USD.
Most liquidations concerned short positions. This means the rise was a clear example of a short squeeze and not a slow trend.
As stop losses were triggered, the price increased rapidly upwards, with almost no resistance.
Regulatory support and expectations for the FOMC strengthen sentiments
The rise came after an important policy update from the US Office of the Comptroller of the Currency. Banks can now participate in crypto transactions without risk. The agency allows banks to handle crypto trading without needing to own the assets directly.
This change gives more institutions access to the crypto market. Since the announcement came just hours before the rise, it may have attracted more participants.
With the Federal Reserve's interest rate announcement approaching, traders now believe that liquidity could improve if interest rates are lowered.
Bitcoin remains close to today's peak level. Volatility is high, and financing in the derivatives market is being adjusted. The market is watching whether demand continues ahead of the FOMC announcement or if profit-taking dampens the price.
