bitcoin price suffered a drop over the weekend and appears poised to retest critical support levels. The downward price action was triggered by an increase in selling pressure following the approval of bitcoin spot exchange-traded funds (ETFs) in the US.
At the time of writing, bitcoin price is trading at $40,900 with a 2% loss in the last 24 hours. Over the past week, these losses have doubled, with other assets in the top 10 cryptocurrencies by market underperforming, except for Dogecoin (DOGE), which is still posting a 4% gain in the same period.
Via social media platform According to Hayes, btc appears poised to lose its current levels.
The founder and cryptocurrency trader claims that the price action on the low time frame will likely push bitcoin below $40,000 and potentially below $35,000 if the bulls fail to defend the higher area around these levels.
The main problem regarding the current market structure lies in the liquidity of the bitcoin market. As seen in the chart below and as noted by Hayes, liquidity in the btc market has been trending downward since the bitcoin Spot ETF was approved.
As a result, and due to constant selling pressure from the Grayscale bitcoin Trust (GBTC), the market has been trending lower and could maintain this course until the next big macroeconomic event.
Why did $SPX and $btc stop rising together after the US btc ETF launched? Both are love plus $liq, which one is right about the future? $btc tells us that setbacks are coming for $liq, the next sign is the US Treasury refund announcement (announcement) on January 31st.
<img loading="lazy" decoding="async" class="wp-image-570793 size-large" src="https://www.newsbtc.com/wp-content/uploads/2024/01/bitcoin-price-btc-btcusdt-1.png?w=860&resize=860%2C286″ alt=”bitcoin price btc btcusdt” width=”860″ height=”286″ srcset=”https://www.newsbtc.com/wp-content/uploads/2024/01/bitcoin-price-btc-btcusdt-1.png?w=2731 2731w, https://www.newsbtc.com/wp-content/uploads/2024/01/bitcoin-price-btc-btcusdt-1.png?w=460 460w, https://www.newsbtc.com/wp-content/uploads/2024/01/bitcoin-price-btc-btcusdt-1.png?w=768 768w, https://www.newsbtc.com/wp-content/uploads/2024/01/bitcoin-price-btc-btcusdt-1.png?w=860&resize=860%2C286 860w, https://www.newsbtc.com/wp-content/uploads/2024/01/bitcoin-price-btc-btcusdt-1.png?w=1536 1536w, https://www.newsbtc.com/wp-content/uploads/2024/01/bitcoin-price-btc-btcusdt-1.png?w=2048 2048w, https://www.newsbtc.com/wp-content/uploads/2024/01/bitcoin-price-btc-btcusdt-1.png?w=750 750w, https://www.newsbtc.com/wp-content/uploads/2024/01/bitcoin-price-btc-btcusdt-1.png?w=1140 1140w” sizes=”(max-width: 860px) 100vw, 860px” data-recalc-dims=”1″/>The btc market sees a decrease in liquidity, which affects the price action. Source: Arthur Hayes in X
If bitcoin goes south, what levels could hold the line?
A pseudonymous crypto analyst presented a group of buy orders accumulated from the $38,819 to $40,000 levels in a separate report. In other words, these levels should present opposition and look like btc's biggest opportunity to recover, at least in the short term.
In that sense, the analyst stated the following, anticipating a possible recovery in the short term, and showing the image below:
Some large zones start to build up around 41K and 42K. I'm pretty sure we'll at least remove that top sometime next week. We'll see if the price holds up after that.
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