According to the most recent market assessments, Bitcoin may experience a deeper correction as a result of favourable funding rates and a dearth of bid liquidity below BTC price.

BTC, or bitcoincounts down$33,401After the opening of Wall Street on October 24, prices consolidated around $34,000.

BTC price volatility was monitored throughout the day using data from Cointelegraph Markets Pro and TradingView, with a focus on $34,000 at the time of writing.

On the strength of renewed excitement around the prospective approval of an exchange-traded fund (ETF) tracking the Bitcoin spot price in the United States, the pair had earlier reached 17-month highs above $35,200.

Monitoring resource Material Indicators discovered a support/resistance (R/S) flip at $30,600 after examining the series of events that resulted in a $5,000 daily candle.

An X post stated that it was unexpected how quickly the market burst through resistance that had been in place for the previous 15 months. 

Indicators for the material "honestly expected to see more resistance at $30.5k, $31.5k, and even $33k."

When a $87M buy wall occurred at those levels, they were destroyed.

"Once $32k was taken out, some of the overhead liquidity was pulled, and the thin liquidity made it easy for BTC to rip to $35k quickly."

With some bid liquidity now being pulled from below, the report continued, there was a "opportunity for a potential retrace."

One of the two accompanying charts covered the Binance order book's previous 24 hours.

Other elements were aligning for a deeper consolidation, such as funding rates across exchanges, which were at the time of writing firmly in the positive.

During an X conversation, well-known trader CryptoBullet stated, "Funding is grossly positive."

The vast majority of traders are long, so that's what it indicates. The majority is almost never correct. Those late longs will need to be eliminated by the market maker.

According to statistics from the tracking tool CoinGlass, BTC short liquidations on the way up were $161 million on October 23 and $48 million on October 24, respectively.

When discussing funding rates, another trader, Daan Crypto Trades, claimed that the market may still maintain its trajectory, which is typical of bull market behaviour.

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The day's regression of Bitcoin's price was accompanied by an increase in the strength of the US dollar, which had been declining the day before.

Dollar recovers as the price of bitcoin stabilises

The U.S. dollar index (DXY) rose 0.5% from its intraday low to retake 106.

Although there used to be a definite inverse association, Bitcoin still shows inconsistent responses to DXY changes.

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Popular macro expert James Stanley recently asserted that the release of the Personal Consumption Expenditures (PCE) data on October 26 would be the primary determining factor for DXY in the short run.

This comes before the Federal Open Market Committee (FOMC) meeting on November 1 where the Federal Reserve will deliberate on interest rate policy, according to Cointelegraph.

According to Stanley, "104.70 was the low from last FOMC, and that's what bulls need to defend."

DISCLAIMER: We don't provide any investment advice.