Tuesday, 27 February 2024

Crypto News

BTC price levels to watch as Bitcoin whales ‘lure’ market to $42K

BTC price levels to watch as Bitcoin whales 'lure' market to $42K

Bitcoin (BTC) faces sharp volatility as the new week begins with BTC price action focusing on $42,000 — can it endure?

The largest cryptocurrency, fresh from weekend gains which topped 10%, is still keeping traders guessing over its next move.

While a trip to $40,000 was well anticipated, the question now is whether or not the latest move represents the beginning of a new trend or, conversely, a new bull trap.

Appraisals currently vary widely, with bullish and bearish perspectives battling for vindication.

Cointelegraph takes a look at the most important support and resistance levels now in play after recent BTC price performance reshapes the market landscape.

BTC/USD is currently trading at around $41,600, per data from Cointelegraph Markets Pro and TradingView, having hit 19-month highs of $42,160 earlier on the day.

BTC/USD 1-hour chart. Source: TradingView

Bitcoin whales hit “sell” at $42,000

A cursory look at order book liquidity provides an immediate snapshot of where buyer support and seller interest lie.

Uploading the data to X (formerly Twitter) on Dec. 4, trading resource Material Indicators showed the strongest concentration of bids at $41,500 and $40,700 at the time of writing.

Little by way of significant sell pressure lay in wait immediately above spot price, with large-volume traders already selling into the rally. This, Material Indicators suggests, is no coincidence.

“As I’ve been saying all week, I thought Bitcoin would continue to climb as long as whales could keep attracting bid liquidity to the range, or they lured enough to distribute into,” it explained in accompanying commentary.

“They succeeded in attracting over $120M to the active trading range so wasn’t surprised to wake up to BTC taking out $42k, before the selling began.”

BTC/USDT order book liquidity data. Source: Material Indicators/X

The analysis added that selling cooled once buy walls had disappeared, with $86 million nonetheless sold off in just 30 minutes.

“Not sure the party is over just yet. A new $30M block of bid liquidity just showed up to potentially continue the game,” it noted.

Liquidity data from statistics resource CoinGlass meanwhile showed $42,420 as a nearby area of interest for derivatives on largest global exchange Binance after the Dec. 4 Wall Street open.

BTC/USDT perpetual swaps liquidity heatmap for Binance (screenshot). Source: CoinGlass

Long-term BTC price levels remain as valid as ever

Zooming out, there is no denying the psychological…

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