Bitcoin (BTC) may be hinting at lower levels during today’s trading session. The leading crypto was rejected near $48,000 and failed to retrace its previous highs.
Bitcoin nears bearish end stop
Data from the Material Indicator is recording little support as BTC price moves in a tight range between $42,500 and $43,500. Bitcoin is losing bid orders that could absorb future downward price action. As the chart below shows, BTC has around $10 million in bid orders drawn while trending downwards. This liquidity appears to be distributed between $42,000, $41,500 and $41,000 and this could stand as the last line of defense against a new attack by the bears, according to analyst Reynaldo Marquez.
The chart also shows how a business places strategic demand orders when the price of BTC tries to regain its previous levels. This happened as investors with around $100,000 in demand orders pushed the price of BTC back to $40,000. In the current price action, it looks like retail traders are the most selling, and traders demanding orders of around $10,000 (yellow and red in the chart below). Only traders with bid orders around $1,000 (green on the chart) show interest in buying the BTC price.
The above shows a potential major asset trying to push the price of BTC down in order to accumulate BTC at optimal levels. The liquidity distribution first concentrated at $42,000 and then spread between those levels and $40,000, which seems to support this thesis. BTC whales often use this method to trap individual sales and gain liquidity to take their positions. As a result, small investors seem to have taken the bait.
Are you ready for a short squeeze?
Ali Martinez, whose analysis we have shared as Kriptokoin.com, has detected an increase in the number of long positions taken on the Binance stock market. The Long/Short ratio is 70% for long position traders and 29% for trade counterparty. On the possible effects of the BTC price, the analyst says:
Bitcoin may be preparing for a cascade of liquidation! 70.69% of all trading accounts on Binance Futures are currently net long-term BTC, which could result in a prolonged squeeze. BTC could drop to $42,000-41,000 to gather liquidity.
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