Bitcoin Analyst Predicts Potential Breakout Towards $75K-$80K, Investor Demand Supports Outlook but Rising Leverage Poses Risk

Analyst projected a likely BTC breakout and rally towards $75K-$80K. Recovering investor demand supported the outlook, but rising leverage could be risky.

Bitcoin [BTC] price charts indicated a potential market structure shift, signaling a likely breakout from the $50K-$72K price range that began in March. According to analyst Stockmoney Lizards, the range breakout could happen in two weeks. If so, the analyst predicted BTC could hit $75K-$80K if the recent drop below $60K is defended as a ‘higher low.’

“For context, BTC has been chalking higher lows since August, a price action trend that signals a potential market structure shift, especially if a higher high is fronted,” Stockmoney Lizards said.

Investors’ appetite for the world’s largest digital asset also improved, suggesting a slow but steady demand recovery in Q4 compared to Q2/Q3. CryptoQuant noted that the pace of the imbalance has eased and the apparent demand for BTC gauged over the past 30 trading days indicated that investor demand hit levels last seen in May.

However, rising leverage, as denoted by an uptick in Open Interest (OI), also posed an imminent pitfall to the breakout expectation. Rising leverage meant speculators took more risk by borrowing money to open BTC positions in the Futures markets. Glassnode reported that the recent weekend pump from $58.9K to $63.4K flushed some short-sellers ($2.5B in OI), but the drop in OI didn’t surpass 5%, a level that historically always saw an extended BTC rally if hit.

In short, heightened volatility and liquidation risks on either side of the price direction could derail the breakout expectation. At press time, BTC was valued at $62.8K and consolidated below the 200-day Moving Average (MA).

The potential breakout towards $75K-$80K is eagerly anticipated by investors, but caution is advised due to the risks associated with rising leverage in the market. Stay tuned for updates on Bitcoin’s price movements in the coming weeks.