Bitcoin Liquidation Data Suggests Price Could Recover to $109,000

The leading cryptocurrency Bitcoin is in a correction phase since reaching its All-Time-High of $111,968 on May 22. The king coin has slipped below the critical support level of $105,000, trading at $104,536 at the time of writing, reflecting selling pressure.

However, on-chain data suggests the potential for recovery above this critical support, with the possibility of retesting BTC's All-Time-High in the near future. This analysis will clarify important information.

BTC Liquidation Cluster Signals Surge to $109,000

Evaluating the BTC Liquidation Heatmap reveals a significant concentration of liquidation around the $109,933 price zone.

The Liquidation Heatmap identifies price levels where large leveraged position clusters are likely to be liquidated. These maps highlight high-liquidity areas, typically color-coded to show intensity, with brighter areas (yellow) representing larger liquidation possibilities.

Typically, these cluster areas act as magnets for price action, as the market tends to move towards these areas to trigger liquidations and open new positions.

For BTC, the convergence of large liquidation volume at $109,933 indicates strong trader interest in buying or closing short positions at that price. This creates an opportunity for an increase towards the $109,000 mark.

Moreover, the coin's funding rate remains positive despite recent price declines. At the time of writing, the rate stands at 0.005%, according to Coinglass.

The funding rate is a periodic payment between traders in perpetual futures contracts to keep the contract price aligned with the spot price. When the funding rate is positive, there is higher demand for long positions.

This means many traders continue to bet on BTC price increases, even as downward momentum strengthens.

BTC Price Fluctuates Between $103,000 Support and $109,000 Liquidity Zone

BTC has recorded a modest 1% increase in the past 24 hours, bouncing from the $103,952 support level. If demand increases, this support level could hold and push the price above the psychological barrier at $105,000, potentially targeting $106,307.

A clear breakout above this zone could open the door to the $109,000 price area, where many leveraged positions exist.

However, increased profit-taking could pull BTC back below $103,952, with the potential to drop further to $102,590.