Bitcoin [BTC] has managed to break the $90k round-number resistance after three weeks of sideways price action between the $85k – $90k region.

Declining whale balances was a warning sign that the rally might face setbacks and delays.

In a post on X, crypto analyst CrypNuevo highlighted another reason why Bitcoin’s expected price bounce might see a liquidity run before the true impulse move.

Analyzing the expected Bitcoin liquidity run

Source: CrypNuevo on X

A liquidity run is an initial false price move that is designed to trap breakout traders, explained the analyst. In this scenario, a breakout past the $94.5k local resistance would persuade bulls that the breakout was underway.

The new long positions’ liquidation levels can then be hunted with a sweep of the lows below $84k. Thereafter, the true impulse move to $100k and beyond can commence.

Source: CrypNuevo on X

At the same time, the analyst warned that it is possible that the resistance at the $92k from the 50-day EMA could reject Bitcoin.

In this scenario, the liquidity run to $96k might not happen, and instead BTC might directly head toward $80.6k in the coming days.

AMBCrypto had noted recently that a move toward $94k-$96k was likely this month but also warned of bearish ETF flows in the second half of December that gave traders a dilemma.

The similarities with Ethereum

Interestingly, Ethereum [ETH] could also see a similar outcome on the price charts. While the leading altcoin tends to follow Bitcoin, the liquidation heatmap outlined what swing traders can expect in January.

Source: CoinGlass

Ethereum has also collected the liquidity at $3,200 and has another strong magnetic zone at $3,500. It also has an attractive liquidity cluster at $2,700-$2,800.

A sweep of these lows could serve as a launchpad for the next ETH rally.

This meant that Bitcoin and Ethereum traders not already in long positions should be patient. Those in short-term profits could use a lower timeframe momentum shift to take profits.

A BTC breakout past the $94.5k is not an automatic signal to go long, and traders should beware of the possibility of a liquidity run.

Final Thoughts

• A sweep of the $96k level and a subsequent reversal below $94k could be a warning sign that Bitcoin could drop to $84k and $80.6k.
• Ethereum liquidation levels also showed similarities to Bitcoin’s, and a price drop to $2,800 was a possibility.