Bitcoin's price consolidation between $58,000 and $60,000 sees potential for explosive short squeeze rallies due to bullish signals from the derivatives market.
Data from K33 Research suggests aggressive shorting with funding rates at their lowest since March 2023, creating a ripe setup for a short squeeze.
A short squeeze occurs when unexpected price increases force traders with short positions to close, further fueling a rally.
Additionally, a significant rise in notional open interest indicates active building of short positions, potentially pushing prices above key resistance walls.
Options data suggest $60,500 as a critical challenge, with heightened volatility expected. Bullish strategies and downside protection through put options indicate mixed market sentiment.
BTC needs to close the week above key levels to continue recovery from its recent lows.
