Although Bitcoin is a potential breakout, its direction still remains unclear

Important points

• Bitcoin trades within its range of 18 days despite the fact that it has fallen below $116,000.

• A lack of clarity between the pro-crypto policies from US regulators, including the Trump Administration, and Bitcoin’s price is making traders nervous.

BitcoinBTCAfter the FOMC minutes were released by the Federal Reserve and Fed chair Jerome Powell spoke at a presser explaining why the Fed decided to not cut rates, the price of ) plummeted on Wednesday. The prices rebounded Thursday, after the US equity and crypto markets refocused on the current fundamentals and projected long-term effects of President Trump’s economic mandate. 

BTC is still trading in the range of $115,000-$121,000, which it’s been doing for 18 days. Data suggests that a new range will be added soon. 

Hyblock Capital analyst described price movement before and after the FOMC as a hunt for liquidity. “a classic indecision 15m candle emerged with wicks on both sides as markets wavered.” Analysts pointed out that the red bid-ask ratio at 10% of orderbook depth increased the likelihood of a price reaching a level for liquidation at $115.883. 

The current heat map of the Binance/Bybit BTC/USDT pair shows that the price and liquidation range remain unchanged. Short liquidations are accelerating over $120,000, while longs may be liquidated below $115,000. 

TRDR data on aggregate orderbook (depths of 2.5% to 10%) shows that the sell wall thickens at $121,100, and there are substantial bids at $111,000. 

Prices are falling, resulting in a downward range extension

Analysts at Cointelegraph suggested on Wednesday that Bitcoin’s price compression BTC may be on the cusp of expanding its range if it does not use aggressive leverage in futures. The Bollinger Bands were also smaller at the time. BTC was trading above its 20-day moving median, which led many traders to expect an upward breakout. 

Despite the fact that Bitcoin is being targeted for its downside liquidity, there are still several positive factors at work. Charles Edwards of Capriole Investments stated that Bitcoin treasury buyers per The past six weeks have seen a dramatic increase in the number of people using day. “with more than three companies buying Bitcoin every single day.” Edwards also noted that his ‘treasury buys and sells’ metric shows that “there’s currently 100:1 buyers versus sellers per month.” 

Related: Bitcoin price retargets $119K as treasuries buy 28K BTC in two days

After a $285 million outflow last week, inflows into spot Bitcoin ETFs are also back. SoSoValue data shows that ETFs received $641.3 millions since July 23. total netflowsBitcoin is still worth a lot of money, even though its price has fallen.

In addition, the White House’s crypto report this week and Paul S. Atkins’ speech on Thursday entitled “American Leadership in the Digital Finance Revolution” set precedents by outlining a set of clear objectives as to how Trump’s administration and US regulators will prioritize the development of the US cryptocurrency industry.

They may not have an immediate effect on the crypto market, but they set up the basis for greater adoption. This gives investors the confidence to invest more in Bitcoin and other cryptocurrencies. 

If Bitcoin sellers dominate the market in the near term, it is likely that the price will drop between $115,000 and $111,000 to absorb the long-term liquidity. Bulls would like to see a bid of $111,000 that generates a spike in volume, which will allow them to take back the $116,000 range. Even better would be for the CVD spot market and the futures contracts to turn positive when buyers push both markets hard in an effort to close the daily above $120,000. 

The article does not provide legal advice or investment recommendations and it is intended for informational purposes only. These are solely the opinions, views, and thoughts of the author and may not reflect the opinions and views of Cointelegraph.