Advanced Trading Squeeze Strategy: Maximizing Profits in Volatile Markets

Bitcoin's recent price action has been characterized by a tug-of-war between bulls and bears, with the cryptocurrency trading in a tight range around the $110,000 mark. This consolidation phase, however, masks significant underlying shifts in market dynamics and accumulation patterns.

Shark Accumulation Signals Potential Supply Squeeze

Data from a prominent analytics platform reveals a notable divergence between short-term traders and larger, conviction-driven buyers. Addresses holding between 100 and 1,000 BTC—often referred to as "sharks"—have added an impressive 65,000 BTC in just seven days. This aggressive accumulation has pushed their total holdings to a record 3.65 million BTC, even as spot prices hovered near $112,000.

This disconnect suggests that long-term players are positioning themselves for the next phase of the market cycle, absorbing supply while short-term traders remain hesitant. Bitcoin's resilience above $110K underscores its strength amid ongoing market turbulence.

On-Chain Data Confirms Structural Demand

Two key on-chain metrics provide further evidence that Bitcoin's current market behavior is driven by deep structural demand rather than short-term speculation:

1. Long-Term Holder (LTH) Net Position Change: This indicator, which tracks 30-day balance shifts among experienced holders, has turned strongly positive. These green spikes suggest active accumulation by long-term players, often a precursor to major bull runs as coins move into "strong hands" less likely to sell during short-term volatility.

2. Exchange Netflow: Recent weeks have been dominated by net outflows—BTC being withdrawn from exchanges. This indicates a preference for cold storage over keeping assets liquid for immediate trading, confirming that recent buying is not speculative churn but actual supply removal from circulation.

The alignment of shark accumulation, LTH buying, and sustained exchange outflows creates conditions for a potential supply squeeze. While short-term corrections remain possible if leverage in derivatives markets overheats, the structural picture favors higher prices as demand accelerates.

Technical Analysis: Consolidation and Key Levels

Bitcoin is currently trading at $115,019, having recovered steadily from early September lows near $110,000. The daily chart shows BTC building momentum as it pushes into a key resistance zone:

• The 50-day Simple Moving Average (SMA) at $114,562 has been reclaimed
• The 100-day SMA at $112,323 is now acting as solid support
• The 200-day SMA at $102,202 continues to anchor the long-term bullish trend

Key levels to watch:

• Resistance: $116,000–$118,000 (recent rally cap)
• Major barrier: $123,217 (cycle high)
• Support: $114,000 (immediate), $112,000 (stronger)

A successful breakout above the $116,000–$118,000 zone could clear the path toward the major barrier at $123,217. As long as BTC holds above $112,000, buyers are likely to maintain control. However, a breakdown below this level could shift momentum back in favor of sellers and potentially bring $110,000 back into focus.

Implementing a Squeeze Breakout Strategy

Traders looking to capitalize on potential breakouts from the current consolidation can consider implementing a volatility squeeze strategy:

1. Identify the squeeze: Use technical indicators like Bollinger Bands and Keltner Channels to identify periods of low volatility. The TTM Squeeze indicator, with a 20-period setting for both Bollinger Bands and Keltner Channels, can be particularly effective.

2. Prepare for breakouts: As volatility compresses, prepare for potential explosive moves in either direction.

3. Entry triggers: Look for price action breaking above or below the squeeze range, confirmed by increased volume and momentum.

4. Risk management: Use tight stop-losses just beyond the opposite side of the breakout to manage risk effectively.

5. Position sizing: Given the potential for sharp moves, consider smaller position sizes to accommodate wider stops without excessive risk.

By combining this technical approach with the insights from on-chain data and whale accumulation patterns, traders can position themselves to potentially benefit from the next significant move in Bitcoin's price action.