Bitcoin has been unable to break above key resistance levels at around $23,000. As a consequence, the cryptocurrency has been moving sideways over the past two days while preserving some of its gains over the past week.
The slowdown in bullish momentum coincides with an increase in asks (sell orders) liquidity for BTC’s price above its current levels and a spike in BTC’s supply inflows on crypto exchange platforms. On short timeframes, there are over $70 million in sell orders for Bitcoin from $23,000 to $24,000.
These levels seem poised to continue operating as resistance while the price of Bitcoin continues to push to the upside. BTC’s price has been tapping into the immediate zone at $23,100, but data from Material Indicators records $18 million in selling orders at this level alone.
As seen below, BTC’s price is seeing less liquidity below its current levels with big liquidity gaps at key levels. This could hint at high volatility to the downside if BTC continues to lose momentum and can’t break above $24,000 in the short term.
In addition, Material Indicators records an increase in selling pressure from investors with sell orders above $100,000. These investors were accumulating BTC over the past week exercising a lot of influence on the price action.
As the chart below shows, these investors (in purple below) have begun selling into the current price action. In this timeframes, it seems too early to conclude if this trend will continue and if it will have a negative impact on BTC’s price.
Further data provided by Ali Martinez records an increase in the Bitcoin held by crypto exchange platforms. This metric is considered bearish as these BTCs are often unloaded into the market.
Since July 12, the analyst said, there has been a spike of 27,000 BTC or $621 million sent to these venues. Martinez commented the following on these metrics:
The increase in open interest combined with a decline in network growth and rising selling pressure from whales and miners suggests that the recent Bitcoin price action is driven by leverage. These network dynamics increase the probability of a steep correction.