Bitcoin Leverage Nears $40 Billion Ahead of Key Fed Vote

💡 DMK Insight

Bitcoin hitting $116,000 is more than just a number; it’s a signal for traders to reassess their strategies. The surge has led to a spike in leveraged positions, indicating that many are banking on a favorable Fed decision this Wednesday. If the Fed cuts rates, we could see further upward momentum, but if they hold steady, expect volatility as those leveraged bets unwind. Traders should keep an eye on the $120,000 resistance level, which could be pivotal in determining the next leg of this rally. But here’s the flip side: if the Fed surprises the market, we might see a sharp correction, especially among those over-leveraged positions. It’s crucial to monitor the funding rates and open interest in the derivatives market to gauge sentiment and potential liquidation points. Watch for any signs of weakness around the $110,000 mark, as that could trigger a sell-off.