Bitcoin’s $80,000 support faces risk from long liquidations

Bitcoin fell to an intraday low of $81,514.28 on Oct. 14 after U.S. inflation data exceeded forecasts and increased expectations for another Federal Reserve interest-rate hike.

September headline consumer prices rose 3.7% from a year earlier, compared with the 3.6% forecast. Core inflation, which excludes food and energy, rose 2.6%, against expectations of 2.5%. Headline prices increased 0.6% from August, in line with forecasts, while core prices rose 0.3%, above the expected 0.2% increase. Gasoline accounted for more than half of the monthly headline increase. Shelter and other underlying costs kept core inflation elevated.

The report strengthened the dollar and weighed on equities. Market pricing put the probability of an October Fed rate hike at about 41%, up from roughly 20%. The Fed raised its target interest-rate range to 3.75%-4% in September. Its next policy decision was scheduled for Oct. 28.

Glassnode’s Binance order-book data showed concentrated spot buy orders near $80,000. Its two-month futures liquidation heatmap showed a large group of potential long liquidations just below that level. Long liquidations occur when exchanges close leveraged bullish positions after prices fall.

If the buy orders remain in place, the liquidations may not be triggered. If the orders are consumed or withdrawn, forced selling could push Bitcoin toward $78,000, about 4.3% below the $81,500 level. Resting orders can be moved or replaced, so the level may change.

Bitcoin remained above Glassnode’s True Market Mean, which measures the average cost basis of economically active investors. The measure stood near $77,500-$78,000. The estimated average cost basis for U.S. spot Bitcoin exchange-traded fund holders was about $81,500. A sustained daily close below that level would leave the average ETF holding at a loss.

Glassnode data showed that realized losses among long-term holders had fallen about 85% from their Aug. 12 peak. Coins spent in profit outnumbered coins spent at a loss by about four to one, compared with roughly 12 coins spent at a loss for every profitable coin in June.

The cost basis for coins acquired six to 12 months earlier was near $88,000, according to Glassnode. That level also contained a large short-liquidation cluster. Holders who bought during that period could sell if Bitcoin returned to their purchase price.

Bitfinex data showed that the median large altcoin fell 14.8% during the latest pullback, compared with Bitcoin’s 7.9% decline. The median altcoin’s decline was 1.9 times Bitcoin’s, above the 1.1-to-1.7 range recorded across the previous five pullbacks since July. Average downside sensitivity was about 1.2 times Bitcoin’s for Ether, 1.5 times for Solana and XRP, and twice for SUI.

Ether ETFs recorded $24.8 million in inflows on Oct. 13, ending nine sessions of outflows. Solana ETFs recorded $1 million in outflows. Ether traded at $2,368.65, down 5.19% over 24 hours in the source data.