Bitcoin’s Support Looks Fragile Amid Weak Demand, Says Bitfinex Alpha
The world’s largest crypto by market capitalization has failed to stay within its consolidation range between $106,000 $116,000 as buying power wanes, according to Bitfinex Alpha.
The price movement is demonstrating little conviction from the bulls, leading to a decline in investor confidence and sentiment. The crypto asset briefly climbed to $116,000 last week, offering a temporary relief to traders. However, long-term holders began selling, but big institutions did not step in to buy, leading to a decline in price.
Traders Turn Cautious Amid Shrinking Price Moves
The platform noted that in the option market, price movements are getting smaller. This suggests that traders are becoming uncertain about the direction of the leading crypto asset and are opting to remain cautious following the big sell-off on October 10th. The uncertain development has slowed due to the overall economic factors.
According to the update, the recent Federal Open Market Committee (FOMC) presented unclear signals about growth and inflation. These signals made investors less willing to take risks.
Despite staying above the $106,000 support level, signs indicate that the market is weakening. Data from on-chain analytics revealed that long-term investors are selling roughly 104,000 BTC each month. This means that many traders are taking profits instead of holding. Meanwhile, short-term traders are losing confidence as their profits shrink, and new buyers are about to enter the market.
BTC Price Risks Drop Toward $100K Zone
Without a renewed flow from ETFs, the price of BTC is likely to stay stuck in the same range and could decline even further as it did on Tuesday. At the time of writing, the digital asset is trading below $104,000, according to data from CoinGecko.
If BTC falls below that area, the asset could slide towards $100,000. However, if it moves up above $116,000 with strong trading activity, it may be the first sign of a real recovery as November knocks.
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