Bitcoin Surges Past $110,000 as Short Squeeze Fears Fuel Market Rally

Bitcoin has reclaimed the $110,000 level, currently trading at $110,838 with a nearly 3% gain in the past 24 hours and a market capitalization hovering around $2.2 trillion. This recovery follows a sharp flash crash that briefly pushed Bitcoin below $107,000 earlier in October, marking one of the month's most volatile episodes.

Analysts, including Michaël van de Poppe, describe the current setup as a "great period for Bitcoin," noting that after retesting lows, BTC is now grinding upwards again. He identified the $111,000-$112,000 zone as a critical resistance area; a breakout above this could pave the way toward $120,000 in coming sessions. Technical indicators support this optimism, with the Relative Strength Index (RSI) bouncing from oversold territory to the mid-40s and the MACD showing early signs of a bullish crossover.

Data from Coinglass reveals large liquidity clusters between $111,000 and $120,000, raising the possibility of a short squeeze. Market analyst Crypto Rover stated, "Bitcoin short squeeze seems possible," as liquidation heatmaps show leveraged short positions stacked above current prices. A break above $112,000 could force these positions to cover, accelerating upward movement, while failure to hold $110,000 may trigger renewed selling pressure.

Ethereum joined the rally, breaking through the $4,000 barrier for the first time in weeks to trade around $4,045, up more than 4%. Other major altcoins, including BNB, XRP, Solana, Dogecoin, Tron, and Cardano, climbed between 5% and 8%, signaling a broad-based resurgence beyond Bitcoin.

The uplift is driven by "buy the dip" sentiment, with over $6 billion in new Tether (USDT) and Circle (USDC) stablecoins entering circulation since last week, often a precursor to spot buying. Despite a broadly bearish sentiment index from Bitwise, intraday models show a bullish divergence, hinting at a short-term reversal. Galaxy Research analysts echoed cautious optimism, noting that while the flash crash dented prices, the broader setup remains constructive, with Bitcoin positioned as digital gold and Ethereum and Solana buoyed by tokenization trends and favorable U.S. regulatory outlook.