![BTC price nears K amid warning Bitcoin sell pressure can ‘double’ BTC price nears K amid warning Bitcoin sell pressure can ‘double’](https://i0.wp.com/images.cointelegraph.com/images/1200_aHR0cHM6Ly9zMy5jb2ludGVsZWdyYXBoLmNvbS91cGxvYWRzLzIwMjMtMDgvOTNjODFlMGEtNDgyMi00MzhjLWJhMTYtM2Y3MzhhM2E2N2UxLmpwZw==.jpg?fit=%2C&ssl=1)
When Wall Street opened on Aug. 18, Bitcoin (BTC) held near two-month lows as markets embraced extreme liquidation.
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Bitcoin price loses key support as ‘liquidity dries up’
Data from Cointelegraph Markets Pro and transaction view Showing BTC price action moving sideways after a single-day candle inflicting an 8% loss.
The largest cryptocurrency saw a spate of liquidations in the derivatives market, which accounted for a “huge” majority amid relatively weak spot sales.
Trading firm QCP Capital wrote in a market update sent to Telegram channel subscribers that day: “Considering the simultaneous large-scale short liquidation, a large account of Deribit is likely to be wiped out.”
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Like others, QCP pointed out that the market’s reaction to the so-called trigger — the write-down of SpaceX’s $373 million BTC holdings — appeared to be overblown.
“This brings back the specter of Elon-driven tops and bottoms in 2021 and 2022, and we certainly hope the market doesn’t return to those times again,” it continued, referring to previous bitcoin sales and the co-CEO’s Elon Musk’s comments on SpaceX and Tesla.
The total liquidation volume challenges what happened immediately after the FTX exchange crash, which sent BTC/USD down to a two-year low of $15,600 in November 2022.
“This feels like another sign that the liquidity market has dried up over the past few weeks,” said financial review resource Kobeissi Letter. Add to part of its own response.
Analyst: Spot sales still 50% below 2023 highs
As the BTC price slowly rises towards $26,000, market participants are divided on the true nature of the situation and its future implications.
related: How low can bitcoin price go?
For popular trader and analyst Rekt Capital, the outlook is bleak – BTC/USD will form a double top in 2023 and completely lack support from trendlines and moving averages during the crash.
“BTC formed higher highs around $31,000 as volume increased. But price formed second half of double top on declining volume,” he wrote As part of multiple X posts.
The accompanying chart shows trading volume on a daily time frame, with Rekt Capital warning that capitulation may not have reached previous sell-off levels.
“While there was a small breakout in seller volume in this crash…it’s still nowhere near the level of seller exhaustion (green box) seen in previous BTC reversals (yellow circles),” he explained.
“In fact, the current number of sellers may need to double to reach the level of seller exhaustion that led to price reversals in early and late March and mid-June.”
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Others were more optimistic, including trader CryptoCon, who identified two key accomplished tasks common to successful BTC price rallies during bull market pullbacks.
These involve relative strength index (RSI) values bouncing off the 0.382 Fibonacci retracement level.
“Every cycle, the weekly Bitcoin RSI experiences false starts beyond the bull market start line, some lasting longer than others,” he said. explained.
“Each of them will revisit the .382 Fibonacci retracement of the move. With the latest dip, both of those things are done now.”
![](https://i0.wp.com/s3.cointelegraph.com/uploads/2023-08/442aff1c-db5c-46c2-97a9-6b800732739a.jpg?w=640&ssl=1)
Rekt Capital pointed out that the daily RSI is currently at the most “oversold” level since June 2022, and Bitcoin has only experienced it twice in history, and both were in bear markets.
Looking ahead, the QCP is also flagging comments from Federal Reserve Chairman Jerome Powell next week as the next potential source of volatility.
“We believe much now hinges on Powell’s speech at Jackson Hole next week,” the report concluded.
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This article does not contain investment advice or advice. Every investment and transaction involves risk, and readers should do their own research when making a decision.
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