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In the past seven days, Bitcoin (BTC) experienced a whopping 14.5% surge, hitting a 20-month high at $41,130 by Dec. 4. Traders and analysts have been abuzz with speculation, especially in the wake of the $100 million liquidation of short (bearish) Bitcoin futures within just 24 hours. However, when we dive into BTC derivatives data, a different story unfolds—one that places the spotlight on spot market action.

The impact of the recent liquidations in Bitcoin futures markets

While the Chicago Mercantile Exchange (CME) trades USD-settled contracts for Bitcoin futures, where no physical Bitcoin changes hands, these futures markets undoubtedly play a crucial role in shaping spot prices. The sheer scale of Bitcoin futures, with an aggregate open interest of $20 billion, underscores the keen interest of professional investors.

In the same seven-day period, a mere $200 million worth of BTC futures shorts were liquidated, representing only 1% of the total outstanding contracts. This figure pales in comparison to the substantial $190 billion in trading volume during the same timeframe.

Even when focusing solely on the CME, which is known for potential trading volume inflation, its daily volume of $2.67 billion should have readily absorbed a $100 million 24-hour liquidation. This has led investors to ponder whether the recent Bitcoin rally might be attributed to the targeting of a few whales within the futures markets.

One could attempt to gauge the extent of liquidations at different price levels using tape reading techniques. However, this approach fails to consider whether whales and market makers are adequately hedged or have the capacity to deposit additional margin.

Bitcoin (BTC) faces sharp volatility as the new week begins with BTC price action focusing on $42,000 — can it endure?

The largest cryptocurrency, fresh from weekend gains that topped 10%, is still keeping traders guessing over its next move.

While a trip to $40,000 was well anticipated, the question now is whether or not the latest move represents the beginning of a new trend or, conversely, a new bull trap.

Appraisals currently vary widely, with bullish and bearish perspectives battling for vindication.

Cointelegraph takes a look at the most important support and resistance levels now in play after recent BTC price performance reshapes the market landscape.

Bitcoin (BTC) starts the first week of December looking better than it has since early 2022 — at over $40,000.

BTC price action is delighting bulls already as the month begins, with the weekly close providing the first trip above the $40,000 mark since April last year.

Shorts are getting wiped and liquidity taken as the bull run sees its latest boost on the back of macroeconomic changes and anticipation of the United States’ first spot price exchange-traded fund (ETF).

Despite misgivings and some predicting a major price retracement, Bitcoin continues to offer little respite for sellers, who continually miss out on profits or are left waiting on the sidelines for an entry price that never comes.

The party mood is not just reflected on markets — Bitcoin miners are busy preparing for the halving, and with the hash rate already at all-time highs of its own, the trend is set to continue this week.

The price of gold has broken through a new all-time high, surpassing the significant level of $2,100 during the Asian session on Monday, Dec. 4. Meanwhile, Bitcoin (BTC) has also surged above $41,000 for the first time in 19 months. 

Bitcoin price breaks $40K...and $41K 

Bitcoin has made a triumphant return to the $40,000 threshold, a figure unseen since the heights of April 2022. This included a swift 2% jump over 24 hours, marking a 19-month peak for the cryptocurrency.

What's more, Bitcoin has now risen over 140% since the beginning of the year.

Insights from Matrixport’s research head, Markus Thielen, suggest an even brighter future. With historical trends of post-bear market bull cycles and upcoming Bitcoin halving events as a backdrop, projections place Bitcoin at over $60,000 by April next year and as high as $125,000 by the end of 2024.

Related: BTC price models hint at $130K target after 2024 Bitcoin halving

Bitcoin (BTC) finally broke above the formidable resistance of $38,000 in the past week and marched closer to $40,000. This move shows that Bitcoin’s trajectory remains up. The bulls will try to maintain the momentum and achieve a strong close to the year, while the bears will try to pull the price down.

The major tailwind for Bitcoin is the expectation that the United States Securities and Exchange Commission (SEC) will approve a spot Bitcoin exchange-traded fund as early as January. Swan Bitcoin CEO Cory Klippsten said in an interview with Bloomberg that the window for the approval for the spot Bitcoin ETF “seems to have been narrowed to January 8th, 9th, or 10th.”

Several analysts expect Bitcoin’s price to soar after one or more spot Bitcoin ETFs are greenlighted. However, traders need to look out for the sell-off after the initial knee-jerk reaction to the upside. The trend of selling into strength after the event has occurred is generally seen in legacy markets, leading to the popular adage “buy the rumor, sell the news.”

Could Bitcoin's rise near $40,000 boost buying in altcoins? Let’s look at the charts of the top 5 cryptocurrencies that may attract investors.

Bitcoin price analysis

Bitcoin rose and closed above the overhead resistance of $37,980 on Dec. 1, which completed the bullish ascending triangle pattern. This setup has a target objective of $41,160.

Bitcoin (BTC) held closer to the $40,000 mark on Dec. 3 after weekend gains reinforced a “strong” uptrend.

Bitcoin leaves $60 million in shorts hanging

Data from Cointelegraph Markets Pro and TradingView tracked a fresh BTC price surge, which took BTC/USD to new 2023 highs of $39,730.

These built on upward momentum, which had entered days prior, as Bitcoin hit $39,000 for the first time since mid-2022.

With derivatives leading into the end of the Wall Street trading week, commentators had argued that spot buyers needed to step up to maintain momentum. Events ultimately took an unexpected turn, with a snap surge across Bitcoin and altcoins wiping previous resistance.

In part of coverage on X (formerly Twitter), popular trader Skew suggested that “someone just ran all shorts across the board seemingly on most pairs.”

Chainlink (LINK) price has rebounded by over 240% from its yearly low of around $4.70 in June 2023. It may rise further still in the coming days and weeks, according to a slew of on-chain and technical indicators, as discussed below.

LINK price nears ascending triangle breakout

LINK's price has been consolidating inside what appears to be an ascending triangle pattern since November 2023.

Ascending triangles are bullish continuation patterns when formed during an uptrend. They resolve when the price breaks above the upper trendline and rises by as much as the maximum distance between the upper and lower trendlines. 

It appears LINK eyes a similar breakout scenario in December 2023, now treading around the triangle's upper trendline near $16. Suppose it rises decisively above the said resistance level. Then, its triangle breakout target will come to be over $19.50, up 20% from current price levels.

Thus, if it rises decisively above the said resistance level then its triangle breakout target will be over $19.50, up 20% from current price levels.

Ether (ETH) is trading higher on Dec. 1, despite its inability to breach the $2,100 resistance. This level has prompted several rejections in the past three weeks, which is especially concerning given Ether’s 16.2% gains in November.

However, the current positive momentum is supported by several factors, including applications for spot ETFs and the expansion of Ethereum’s ecosystem, driven by layer-2 solutions.

ETH benefits from ETF expectations and negative news related to competing blockchains

A pivotal development occurred on Nov. 30, with the U.S. Securities and Exchange Commission (SEC) initiating the review process for Fidelity’s spot Ether ETF proposal, filed on Nov. 17. This move, along with similar applications from firms like BlackRock, awaits regulatory green light. If approved, these ETFs would bolster Ether's status as a digital commodity, reducing the likelihood of it being treated as a security.

Despite analysts predicting the SEC might delay its decision to early 2024, interim deadlines for applications by VanEck and ARK 21Shares on Dec. 25 and Dec. 26, respectively, have kept the market engaged. The mounting interest from large mutual funds in Ether products is creating a favorable impact on its price.

The Ethereum network's growth, especially in transaction activity and layer-2 development, is noteworthy. The Ethereum layer-2 ecosystem has become increasingly important as the average transaction fee held above $4 for the last couple of months. These layer-2 solutions offer more cost-effective and flexible options than the base layer.