Bitcoin rally could hold as spot buying outpaces leverage: Bitfinex analysts

Bitcoin has climbed about 23% over the past week to $77,535 as Bitfinex analysts say spot buying, ETF inflows and limited leverage could give the rally more staying power than a typical short squeeze.

Why Bitfinex sees more runway for Bitcoin

Bitfinex analysts told crypto.news that forced liquidations helped Bitcoin break out of its previous range, but spot purchases and returning institutional demand have continued supporting the price after much of the short pressure cleared.

Bitcoin ($BTC) traded at about $77,535 at the latest check after reaching an intraday high near $79,200. The cryptocurrency was up almost 7% over 24 hours and about 23% over seven days, extending a rally that began below $65,000 on Aug. 19.

Although squeeze-led advances often weaken once traders finish closing bearish positions, Bitfinex said the combination of ETF demand, improving macro conditions and limited selling could give the latest move a “longer runway,” with smaller retracements still possible.

Derivatives activity provides part of the evidence behind that assessment. Bitcoin gained between 10% and 11% during the initial breakout, while aggregate open interest rose by only about 4%, according to figures cited by the analysts.

“The shape of the move is the tell,” the Bitfinex team said. “Rallies built on fresh leverage show open interest jumping in step with price.”

Because open interest increased at a much slower pace than Bitcoin’s price, the analysts said spot buying and short covering performed most of the work. New leveraged positions played a smaller role, reducing the immediate risk of another large liquidation event caused by an overcrowded long market.

A weaker version of the setup would show open interest building quickly while Bitcoin stops rising. Bitfinex said the latest data had not displayed that pattern, although derivatives positioning will remain important if traders add leverage after the price increase.

Spot demand has outpaced fresh leverage

Bitcoin’s move began with a large short squeeze after the price cleared resistance around $65,000 and then crossed liquidation clusters near $67,000. Traders who had borrowed funds to bet on a decline were forced to buy Bitcoin as exchanges closed positions that no longer held enough collateral.

More than $1 billion in crypto short positions were liquidated within about one hour. Total short liquidations later approached $1.79 billion, while a longer market-wide count placed bearish liquidations near $2.7 billion over 24 hours.

The forced purchases helped Bitcoin jump from below $65,000 to approximately $69,500 on Aug. 19. As earlier liquidation data showed, the move carried $BTC through several liquidity bands between $65,000 and $67,500 before it tested the upper cluster around $69,000.

Short covering explains the speed of the advance but does not fully account for Bitcoin holding above $70,000 after many bearish positions had closed. Bitfinex pointed to spot purchases and ETF inflows as evidence that other buyers entered during the breakout.

The distinction matters because liquidation demand is temporary. Each forced purchase closes an existing position, while continued spot accumulation can remove coins from the available market without creating the same exposure to futures liquidations.

Open interest will therefore remain one of the main indicators for judging the rally. A sharp increase in leveraged positions without matching price gains would weaken Bitfinex’s current reading, while steady prices accompanied by restrained open interest would remain consistent with a spot-led move.

The $68K–$69K zone could determine whether Bitcoin holds

Bitfinex identified the $68,000 to $69,000 area as the most important support zone because Bitcoin’s short-term holder cost basis currently sits within that range.

The metric represents the average acquisition price of coins held by investors who entered the market during the previous several months. Bitcoin trading above the level means that recent buyers are collectively holding unrealized profits, according to the analysts.

A sustained price above the range could limit pressure from holders seeking to exit at break-even. Falling below it would place part of the recent buyer group back into loss and could increase selling if confidence weakens.

The same area contains Bitcoin’s 200-day moving averages. $BTC crossed its 200-day simple and exponential moving averages near $69,000 during the rally, reclaiming the long-term indicators for the first time in about nine months.

Barchart noted that Bitcoin had remained below its 200-day average since November 2025, about one month after it reached a record above $126,000. A sustained hold above the indicator would support the view that the decline from the October peak is losing strength, though the technical signal cannot guarantee further gains.

For a clearer measure of U.S. participation, Bitfinex said traders should monitor the Coinbase Premium. The indicator compares Bitcoin’s price on Coinbase with prices on other major exchanges, with a positive reading suggesting relatively strong demand through the U.S.-focused platform.

According to the analysts, a Coinbase Premium that catches up with the rally would provide a cleaner signal that American buyers are returning. Weakness in the indicator would suggest that demand remains concentrated outside the United States or in offshore derivatives markets.

ETF inflows and Treasury yields remain key tests

U.S. spot Bitcoin ETFs received approximately $517 million in net inflows on Aug. 19, their strongest daily result since May, according to SoSoValue data cited by market analysts. The funds added about $606 million on Aug. 20, bringing their two-session intake above $1.1 billion.

Across Monday through Thursday, the products attracted approximately $1.6 billion, putting them on course for their strongest week of 2026. Bitfinex said a complete week of inflows at a similar pace would strengthen support and provide firmer evidence of a lasting change in demand.

American investors access Bitcoin through the funds on regulated securities exchanges, making ETF flows a direct measure of demand from U.S. brokerage and institutional accounts. Continued inflows would also separate the rally from an advance driven mainly by traders closing short positions.

As reported earlier Friday, Standard Chartered global head of digital asset research Geoff Kendrick said recovering ETF flows and low open interest could allow more investors to return as Bitcoin rises.

“For the first time this year there is now a risk my end year forecast (of USD100k) is too low,” Kendrick wrote in a client note.

Kendrick said Bitcoin could move toward its $126,000 record before year-end, potentially gaining speed after Oct. 6. Standard Chartered has not formally replaced its $100,000 forecast with a $126,000 target; Kendrick described the record as a possible overshoot if the recovery continues.

Macro conditions have also supported the rally. On Aug. 19, the U.S. Treasury Department announced that it would at least double the maximum size of liquidity-support buybacks for government securities in the 10-to-20-year and 20-to-30-year maturity sectors.

The maximum will increase from $2 billion to at least $4 billion per operation beginning Sept. 9 and remain in place through Nov. 4. Long-term Treasury yields initially declined after the announcement, improving conditions for risk assets as Bitcoin moved through $70,000.

Bitfinex identified renewed increases in Treasury yields and the exhaustion of short covering as possible obstacles. The analysts also warned that a large volume of profitable Bitcoin has moved onto exchanges during the rally, creating the risk of the year’s largest profit-taking wave if holders begin selling those coins.