Bitcoin Faces ‘Extremely Limited Liquidity’ As BTC Price Pushes Below $43k
Bitcoin (BTC) saw regional volatility on January 15 as an analyst warned of book liquidity.
Analysis: Bitcoin may need weeks to recover.
Data from Cointelegraph Markets Pro and TradingView tracked BTC price volatility before rebounding to near $43,000, with the market down 1.5% in an hour.
The moves came during a Wall Street holiday, leaving the door open for more erratic price behavior.
In recent posts on X (formerly Twitter), popular trader Skew said that spot markets are not deep enough to ensure stability on lower timeframes.
“There is very limited liquidity right now to expect a 1K candle of some sort to come from anywhere,” he wrote before volatility hit.
“Above $42.8K, bulls can flex their muscle below the annual open market, and bears can take control.”
The $43,000 round trip, Skew added, was derivatives-driven — and likely unsustainable.
LTF Spill Driven by $BTC Perp, Should Drive to Support Properly and Receive Over $42.8K
Spot driving means the price is limited and the vehicle space is auctioned, which was not the case here pic.twitter.com/OzjejKNYSg
— Skew Δ (@52kskew) January 15, 2024
Thinking that BTC/USD may be licking its wounds after plunging 15% last week, on the other hand, analyst Matthew Hyland sees the recovery as likely to take more than a month.
“Bitcoin can go sideways here for a while,” he commented with a chart showing the volume of buys and sells.
“We've seen this much red volume every week for the past 4 times; it's been at least 3-4 weeks of sideways price action. If the dominance breaks, this area is beneficial for Ethereum+ Alts.”
The chart shows a comparison between last week's panic sell-off and the atmosphere at the end of Bitcoin's 2022 bear market.
A month away for BTC price collapse?
Turning to what comes next, prominent trader and analyst Rect Capital lays out a possible path for BTC price action ahead of the April block grant halving.
Related: BTC speculators drop $5B – 5 things to know in Bitcoin this week
Any last-minute gains, he said, would show themselves two months before the event — giving the bears little time to spring any major setbacks.
“If BTC is going to make a deep correction in the pre-half term (orange), it should happen in the next 30 days or so,” summarized the commentary on the accompanying chart.
The next X post also placed BTC/USD firmly within its established weekly trading range despite recent volatility.
#BTC still in weekly range $BTC #Crypto #Bitcoin pic.twitter.com/gjJqOZTo63
— Rekt Capital (@rektcapital) January 15, 2024
This article does not contain investment advice or recommendations. Every investment and business activity involves risk, and readers should do their own research when making a decision.
