Increased activity in the Bitcoin (BTC) futures markets is playing a dominant role in its short-term price action, which tracks back to where leveraged positions are. Prices tend to trend towards places where liquidity is most concentrated, and as Bitcoin struggles to stay above $64,000, a review of current liquidation scenarios could provide insight into BTC’s next move.

Liquidation heatmap data shows a cluster of tiny positions concentrated in the $65,500 to $66,000 range, or approximately 3% from current market prices. A break through $65,600 could trigger this shelf and accelerate a larger rally towards $67,000.

Below market prices, support is split between $63,500 and $63,750, with the nearest cluster being 1% away, and larger liquidity pools at $63,000-$63,250 (down approximately 1.5%) and $62,500-$62,750 (down approximately 2.3%).

Total long side liquidity in the tracked window outweighs tiny side liquidity by almost two to one, potentially signaling that most of the leverage created over the past month has not been fully closed.

BTC liquidation heat map, monthly overview. source: Hyblock

In the worst-case scenario, a broad liquidation band near $55,000 (which has accumulated throughout the month) is observable and stands out more than anything else on the chart. This magnet could have an impact on the price if the support at $62,500-$63,750 gives way.

The last few weeks of price action suggest that Bitcoin could remain in the $60,000 to $67,000 range, and BTC’s combined open interest and funding rates support this view.

BTC spot and cumulative volume flows. source: Hyblock

While OI is down more than 3% from Tuesday’s high, the BTC price has barely moved, and with funding cooling towards neutral, spot and futures flows have been supportive of the buy side over the past week.