Bitcoin reclaims $110K as traders eye $112K breakout, ZEC lead altcoins

Bitcoin extended its gains today, reclaiming the key support level above $110,000 as easing macroeconomic tensions brought renewed momentum to the market.

The total cryptocurrency market capitalisation rose by over 2% at the time of writing, stabilising above $3.85 trillion alongside a sharp uptick in trading activity.

Bitcoin’s trading volume jumped more than 55% in the past 24 hours, signalling a return of investor confidence after last week’s sell-off.

Market sentiment, however, remained cautious.

The Crypto Fear and Greed Index stayed in the “Fear” zone at 29, though analysts expect a rebound once risk appetite improvement after the US market opened.

Bitcoin’s recovery also helped spark modest rallies across the altcoin sector, with several tokens managing to recoup a portion of the losses sustained over the weekend.

Why is Bitcoin price going up?

Bitcoin hit an intraday high of $111,374 today after recovering from weekend lows around $104,778 triggered by ongoing tensions regarding US–China trade and geopolitical friction.

However, sentiment turned around on Sunday after reports confirmed that senior Chinese officials are set to meet their US counterparts this week to iron out differences ahead of the Trump–Xi Jinping summit at the APEC meeting in South Korea. 

The confirmation, relayed by both Chinese state media and US Treasury Secretary Scott Bessent, signalled a potential diplomatic thaw. 

That, in turn, helped ease market jitters and lifted risk assets across the board, with Bitcoin among the main beneficiaries.

The renewed dialogue comes at a time when the US and China have issued strong warnings against each other, with Beijing threatening retaliatory action if new tariffs are imposed and even hinting at cutting off rare earth exports. 

But markets appear to be pricing in a more constructive path, at least in the short term, as hopes build that upcoming talks may defuse the situation.

At the same time, there’s growing optimism around the Federal Reserve’s next policy move.

Several top Fed officials, including Jerome Powell, Michele Bowman, and Christopher Waller, have signalled support for an additional interest rate cut in the upcoming meeting. 

If delivered, it would mark the second consecutive cut, further loosening financial conditions.

With the unemployment rate ticking up to 4.2% and the private sector shedding 36,000 jobs in September, the case for monetary easing has strengthened.

Polymarket odds for a rate cut have now surged to 96%.

Expectations are pinned at 3.1% inflation for September, and anything softer could add fuel to the bullish setup for crypto.

Today’s recovery rally has also been supported by opportunistic buying from traders looking to capitalise on oversold conditions, followed by fresh inflows from both institutional and retail participants chasing the bounce.

The backdrop of improving macro conditions and reduced geopolitical overhang has acted as a catalyst for this rotation.

According to data from CoinGlass, total Bitcoin open interest climbed 4.5% over the past 24 hours to $34.5 billion.

Perpetuals saw a 4.62% uptick, while futures rose by 2.54%. 

The rise in open interest alongside rising price levels typically points to new long positions being opened, which is a sign that traders are positioning for further upside.

Meanwhile, liquidation data from the past 24 hours paints a clear picture of how the bounce played out in real time. 

More than 106,000 traders were liquidated, with total losses amounting to $415.97 million.

Notably, short positions accounted for $260.71 million of that total, far outweighing the $155.26 million in long liquidations.

As such, much of today’s upward pressure likely came from short squeezes, especially as price broke above key technical levels and forced leveraged bears to exit.

Will Bitcoin price go up?

As of press time, Bitcoin’s 24-hour liquidation heatmap showed that the flagship cryptocurrency was trading between two prominent liquidity clusters, with one band of liquidations building around the $110,000 zone and another concentrated near $112,000.

The region just above $110,000 appears to have absorbed a significant portion of recent short liquidations, effectively flipping from resistance into a temporary support. 

Meanwhile, the band near $112,000 is showing elevated liquidation leverage density, suggesting it could act as the next hurdle before an upside rally. 

This area is where a large number of short positions have likely been stacked, and if breached, could trigger another cascade of forced buybacks that might push the price even higher in a short squeeze scenario.

Conversely, the lower end of the heatmap shows less immediate liquidation pressure below $108,000, indicating that much of the overleveraged long exposure has already been cleared out during the weekend drop.

From a structural standpoint, Bitcoin now finds itself wedged between these two zones, a region often referred to by traders as a “liquidity pocket.” 

Price could remain rangebound here in the short term as traders assess macro developments and position ahead of Friday’s CPI print and next week’s Fed decision.

Should Bitcoin convincingly break above $112,000 and absorb the overhead liquidity, the next leg higher may come swiftly. 

However, failure to do so could see the price drift back toward $108,000, where bids are likely to re-emerge given the now-cleared liquidation field.

With open interest rising and leverage returning to the system, volatility is likely to stay elevated.

Manay analyst expectations were leaning in favor of an upside rally when writing.

Among them, was well-followed crypto personality Ted Polllows. See below: