Bitcoin Hits a Crowded Price Zone as Traders Cut Back on Leverage

Bitcoin traded near $83,000 on Tuesday, retesting the price range that holds more long-term holder supply than any other.

BTC touched $87,000 last week before pulling back. Glassnode earlier flagged $81,000 to $86,000 as the key range, but the biggest long term holder band has now tightened to $84,000 to $85,000.

Bitcoin Open Interest Falls to Lowest Since March

Coin-denominated open interest has dropped almost 20% from its August level and sits at its lowest since March. Bitcoin is still about 35% above its August low of $62,000. Bitfinex analysts said most of the leverage built up during the run to $87,000 has been cleared, and perpetual positioning is now close to neutral.

Support and Resistance Levels to Watch

JPMorgan puts bitcoin’s estimated production cost at $85,000, which could ease pressure on miners and lower the risk of forced selling if prices hold there.

Treasury Yields, Fed Rate Hike and Crude Oil

Blockto Analysts say Conditions tightened after the Federal Reserve raised rates earlier this month. The 10-year Treasury yield closed at 5.17% on Sept. 25, up from 5.01% on Sept. 16, while the inflation-adjusted yield rose to 2.83% from 2.68%. Capital.com analyst Kyle Rodda added that higher crude prices weigh on non-yielding assets like bitcoin, though he still called the technical setup quite constructive. Traders now watch the August core PCE reading on Sept. 30.