The crypto market is in a buoyant mood on Monday after bitcoin (BTC) rose to $93,350, its highest level since Dec. 11, before giving back some of those gains. The bulk of the move occurred at midnight UTC, around the time bitcoin futures trading opened on the CME exchange, which created a "gap" between $90,500 and $91,550. These gaps typically get filled over the course a few days, meaning the price will likely return to the $90,500 level at some point since week. Traders are mainly focusing on bitcoin ...

Core Insights - Bitcoin (BTC) is approaching a critical price level of $87,000, which poses risks to large bearish positions and may trigger a "short squeeze" if breached [1][2] - The current market indicators suggest a potential local bottom, with negative funding rates and reduced open interest indicating a shift in market dynamics [3][4] Group 1: Market Dynamics - Large bearish bets initiated on Binance during recent market downturns are at risk of liquidation around the $87,000 mark, which could lead to forced closures of these positions and create bullish momentum [2] - The concentration of high-density liquidation leverage in the BTC/USDT pair on Binance is primarily above $87,000, indicating significant volatility potential if this level is surpassed [2][3] Group 2: Funding Rates and Market Structure - The global average funding rate is currently at -0.006%, indicating that short positions are paying long positions, reflecting a bearish bias in the market [4] - Historically, negative funding rates have coincided with seller exhaustion and local market bottoms, suggesting a potential reversal in price trends [5] - Open interest in Bitcoin has decreased from approximately 752,000 BTC to about 683,000 BTC, indicating a cleaner market structure with less leverage at risk, which may support price recovery [6]