Bitcoin’s price action continues to stall as the cryptocurrency moves within a tight range; uncertainty is king in the current environment. Market participants are more bullish after BTC is up 12% from yearly lows, but the possibility of a sustainable rally is diminishing.
The sideways price action influences the sentiment in the market. At the time of writing, Bitcoin (BTC) is trading at $16,800. Other cryptocurrencies in the top 10 by market capitalization are showing similar price action, with very little gain on these time frames.
Bitcoin Whales Jump Ship, what this means for BTC
Bitcoin has been evolving along with the legacy financial markets since late 2021. The cryptocurrency is responding to the monetary policy of the US Federal Reserve (Fed) as a risk-bearing asset. The financial institution raises interest rates to curb inflation.
As NewsBTC reported, sentiment in the old financial market was bullish and robust, supporting a 12% BTC rally. Sentiment in this sector was strong enough to drive BTC price higher in a hostile environment.
The second largest crypto exchange in the world, FTX, collapsed. This event triggered another capitulation event in the crypto market, pushing BTC to new lows. However, stocks moving upwards reversed the losses on the nascent asset class.
The bullish momentum is fading as the FTX debacle affected crypto investor confidence in the nascent asset class. Analyst Ali Martinez shared recent Bitcoin whale data. These investors are selling into the current BTC price action. Martinez said:
About 33 whales with $1,000 to $100,000 BTC have left the network, and these whales have sold or redistributed about $20,000 BTC in the past 96 hours.
Sales increased due to the strong economic growth in the United States. The Fed has more room to continue its tightening policy if the economy is resilient.
Additional data from analytics firm Jarvis Labs indicates that $16,550 and $19,150 are key. As uncertainty persists, leverage players are taking positions to take advantage of a potential breakout.
These positions add liquidity below and above the Bitcoin price. The chart below shows that these levels contain the most extensive pools of liquidity. So if the market taps into them, whales can steer the price in a certain direction.
For example, BTC whale may continue to sell to tap into liquidity around $16,550; this move will remove most of the leveraged positions. Then the price may try to bring upside liquidity to around $19,150.