QCP Capital: Bitcoin may surge to $94,000, but a breakout requires genuine trading volume support

According to Gate market data, as of December 30, the price of Bitcoin (BTC/USDT) is currently reported at $87,709.9. Options market data shows that the open interest of unclosed contracts after options expiration has decreased by approximately 50%, reflecting that market funds are choosing to wait and see at the end of the year.

QCP analysts believe that the market needs genuine trading volume inflows, rather than relying solely on leverage or liquidation-driven volatility, to achieve an effective breakthrough toward the key level of $94,000.

Market Status: Holiday Liquidity Thin, Bitcoin Oscillates Upward

Against the backdrop of light trading during the year-end holiday, the Bitcoin market presents a typical “low-volume rebound” scenario. Gate market data shows that the latest BTC/USDT quote is $87,709.9, down 1.95% in the past 24 hours. This price fluctuation occurs during a period of significantly reduced overall market activity. QCP Capital analysts point out that although Bitcoin rose about 2.6% in the early session, this was mainly driven by spot and perpetual contract buying rather than large-scale liquidations.

This price increase driven by limited buying interest raises questions about its sustainability. The core issue is that the market lacks broad participation and genuine capital inflows, making the rebound’s foundation fragile.

Options Market Signals: Sharp Drop in Open Interest, Traders Shift to Short Gamma

Delving into derivatives markets reveals more subtle changes in risk structure. The most notable change occurred after a recent large-scale options expiration. According to QCP observations, after options expiration, the open interest in the market sharply declined by about 50%. This indicates that a large number of options positions used for hedging or speculation have been closed, temporarily withdrawing capital from the market and weakening its buffer capacity. Meanwhile, market makers’ (dealers’) positions have undergone a key shift. Before expiration, dealers typically held “long gamma” positions, meaning they needed to buy low and sell high to maintain delta neutrality, which inherently stabilized prices.

However, according to QCP reports, the current BTC perpetual funding rate on Deribit has risen above 30%, indicating that traders are now in a “short gamma” state on the upside. The shift of dealer positions from “long gamma” to “short gamma” is a critical risk point in the current market. This means that if Bitcoin’s price continues to rise and approaches $94,000, these traders will be forced to buy spot or short-term call options to hedge.

This forced buying behavior itself will push prices higher, potentially triggering a positive feedback loop of “gamma squeeze,” accelerating the price increase. QCP emphasizes that if the price stabilizes above $94,000, this could significantly amplify the hedging buy pressure.

Liquidations and Leverage: Long Liquidation Pressure Under Control, but Market Leverage Still Building

Despite price volatility, recent liquidation pressure has been relatively mild. According to Coinglass data, in the past 24 hours, total liquidations across the network amounted to $300 million, with long positions liquidated at $159 million and short positions at $141 million. Specifically for Bitcoin, long liquidations totaled $54.5914 million, and short liquidations totaled $48.2331 million. Compared to historical single-day liquidations often reaching billions or tens of billions of dollars, the current liquidation pressure is insufficient to dominate the market. This supports QCP’s view that the recent rise is “not liquidation-driven.” However, another warning sign is the continued increase in market leverage. Data shows that despite a 40% contraction in market activity in December, traders added $2.4 billion in leverage throughout the month.

Bitcoin and Ethereum futures open interest increased from $35 billion to $38 billion, a 7% rise. This indicates that, beneath the market’s apparent hesitation, speculators are quietly increasing their bets on the market’s future direction.

Institutional Fund Flows: Spot ETF Faces Continued Outflows

From the institutional funding perspective, the market also faces some headwinds. According to Matrixport reports, Bitcoin spot ETFs have experienced net outflows for nine consecutive weeks, with total net outflows approaching $6 billion. Since December, the outflow has already reached about $1.1 billion. If this month ends with net outflows, it will be the largest capital withdrawal since the ETF’s listing in January 2024.

This ongoing outflow puts pressure on market liquidity and partly explains why Bitcoin’s price struggles to break through key resistance levels. The temporary exit of institutional funds contrasts sharply with the quietly increasing leverage among retail traders, adding to market instability.

Price Forecast: Technicals Point to $95,000, but the Path Is Rocky

Despite challenges such as low trading volume and capital outflows, many analysis institutions remain cautiously optimistic about Bitcoin’s short-term technical outlook. Blockchain news outlet Blockchain.news’s comprehensive technical analysis indicates that Bitcoin currently shows potential for further upward movement. Its predictive models set a short-term target (within 1 week) between $93,000 and $95,000. Among them, Changelly’s model is the most aggressive, estimating Bitcoin could reach $95,714 before December 31.

Technical indicators also support the upside. The MACD histogram reads 397.58, indicating bullish momentum is building. Meanwhile, Bitcoin’s price is above the middle band of the Bollinger Bands, and the Relative Strength Index (RSI) is at a neutral 53.10, suggesting there is still room for upward movement before entering overbought territory.

Key resistance is at $91,941 (upper Bollinger Band). If this level is broken effectively, it could trigger algorithmic trading buy orders and momentum-driven follow-through. However, all of this depends on the market being able to generate enough trading volume to overcome the potential selling pressure near $94,000 caused by options structures.

Future Outlook: Facing Challenges, Gate’s Role as a Trading Platform

QCP Capital’s analysis paints a clear picture of the current Bitcoin market: technically, there is potential to break through to $94,000 or even higher, but this path is blocked by two major obstacles—“low genuine trading volume” and “institutional fund outflows.”

The shift of options traders to a “short gamma” stance acts as a double-edged sword, potentially triggering a “gamma squeeze” that accelerates price increases, but also weakening the market’s own stability mechanisms. For investors, closely monitoring market movements on platforms like Gate, which provide deep market data and a stable trading environment, is crucial. A true trend breakout will likely require the end of the holiday period, liquidity to return, and a reversal of institutional fund outflows.

The market’s next directional move may well depend on when these key conditions are met.