Bitcoin surges 26% on ETF inflows and short liquidations, faces key resistance at $83,000–$86,000

Huoxing Finance reports: On August 27, Glassnode released its latest weekly on-chain report, stating that Bitcoin has rebounded 26% since its mid-August low, with a record single-day short liquidation triggering this rally. Subsequent support came from ETF inflows, declining exchange balances, and continuous accumulation across wallets of all sizes. The report notes that August 19 marked the largest single-day short liquidation in Glassnode’s data since 2019. During this rally, 85% of all liquidations were short positions, and the market absorbed 86% of the modeled liquidation liquidity along the way. Currently, a significant cluster of short liquidations remains concentrated between $82,000 and $86,000, while long liquidation zones lie between $60,500 and $62,400 below. On the funding side, U.S. spot Bitcoin ETFs recorded a net inflow of $2.23 billion during this rally, with seven consecutive days of no outflows—the strongest seven-day inflow period this year. Meanwhile, Bitcoin futures open interest, measured in BTC terms, declined by 11%, and perpetual contract funding rates remained largely neutral, indicating this rally was not driven by new leveraged long positions. Since the June 30 low, entities holding 1,000 to 10,000 BTC reduced their holdings by approximately 50,500 BTC, while entities holding over 100,000 BTC increased their positions by about 59,100 BTC. Glassnode believes this reflects a shift of Bitcoin from large individual holders toward larger institutional custody addresses. Simultaneously, the 30-day cumulative trend scores for all six wallet size categories remain at or above the neutral level of 0.5, suggesting broad-based market participation in accumulation. The correlation between this rally and traditional U.S. equity markets has significantly weakened. During this rally, Bitcoin rose 25%, while the S&P 500 fell 1.7%, with their one-month rolling return correlation approaching zero—indicating this move is primarily driven by crypto-specific capital flows rather than risk appetite from traditional stock markets. From a technical and on-chain supply perspective, the $83,000–$86,000 range represents the most critical resistance zone. The first self-custody cost basis band appears near $80,800; market makers’ Gamma turns negative near $82,300; and this same range also concentrates a large volume of short liquidations and long-term holder supply. Glassnode suggests that if Bitcoin continues rising into this zone, it will test whether long-term holders are willing to sell near their cost basis. On the downside, $70,000 represents the short-term holder cost basis, while the $62,000–$65,000 range forms a key support zone established during the June–August consolidation. If Bitcoin breaks below $70,000, the market may test the $62,000–$65,000 support next; a retest of the $62,900 level—the starting point of this short squeeze—could signal a complete reversal of the rally. The options market suggests traders currently expect Bitcoin to remain range-bound. The middle 70% implied range for options expiring on September 25 is approximately $69,000–$89,700, with the median close to the current price. Glassnode notes that the options market does not currently treat a breakout above $86,000 or a retest of lower support as the primary scenario. This rally exhibits a phased recovery pattern: initiated by short liquidations, sustained by ETF inflows and spot demand, and reinforced by tightening on-chain supply. If Bitcoin holds above $83,300 and ETF inflows continue, it will further confirm that the overhead supply wall is being absorbed. Conversely, the $70,000 short-term holder cost basis and the $62,000–$65,000 zone will remain critical support levels to monitor on any downside move.