Bitcoin price trades in a three-week range and data suggests the pattern could continue for a few more days as BTC "shark" demand and liquidity remain low.
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$94,176 price has been consolidating within a roughly $11,200 range over the last three weeks as bulls failed to sustain the recovery above $100,000.
Bitcoin has been stuck between its resistance level at $102,750 and support at $91,200 since dropping from its Dec. 17 all-time high of $108,364.
BTC/USD daily chart. Source: Cointelegraph/TradingView
Let’s look closer at the reasons why the BTC price remains stuck today.
Low “shark” activity and liquidity
The crypto market appears to be in limbo ahead of US President-elect Donald Trump’s inauguration.
“Bitcoin has been struggling to crack the much-coveted $100K psychological resistance level as the crowd has been growing restless once again,” Santiment analyst Brianq said in an analysis note on Jan. 10.
According to the analyst, the lackluster price action displayed by Bitcoin is due to reduced buying by Bitcoin wallets holding between 100 and 1,000 BTC, also known as “sharks.”
Brianq notes that “enormous accumulation” by these entities was responsible for Bitcoin’s 91% rally between Oct. 11 and Dec. 17, when it reached its current record highs.
“Since Dec. 18, 2024, this group’s buying has come to a halt.”
Bitcoin wallets holding between 100 and 1,000 BTC. Source: Santiment
In addition, uncertainties surrounding the new US administration and the anticipation of significant data releases have led to reduced global liquidity.
The chart below shows Global Liquidity (Global M2), an indicator that tracks growth in global money supply from major central banks against Bitcoin price, which has been dropping since October 2023. Global M2 has been stuck within a narrow range over the last three weeks.
BTC/USD vs. Global Liquidity (M2) indicator. Source: Cointelegraph/TradingView
Reducing Global M2 means less money entering the global system, discouraging spending on perceived “risk assets” such as Bitcoin. This could reduce trading volumes, keeping Bitcoin’s price movements minimal.
“The battle right now is between the bullish divergences and the liquidity still lower,” said technical analyst Kevin in response to Bitcoin’s current price action.
Related: MicroStrategy’s Bitcoin debt loop: Stroke of genius or risky gamble?
Bitcoin stuck between two trendlines
On Jan. 7, Bitcoin’s price fell below the support provided by the 50-day simple moving average (SMA), which is currently at $97,573, as shown on the daily chart below.
This move, however, saw BTC/USD find support at $92,000, a key support level since Nov. 20.
BTC/USD daily chart. Source: Cointelegraph/TradingView
Bitcoin’s price is fighting the resistance from the 50 SMA, which it needs to overcome to increase the chances of breaking out of the current consolidation pattern.
Additional data from IntoTheBlock shows the ongoing stalemate between buyers and sellers. Its in/out of the money around price (IOMAP) model reveals that the price is stuck between two significant levels.
Namely, these are the $92,000 to $94,800 demand zones, where approximately 887,960 BTC were previously bought by 1.1 million addresses.
Bitcoin IOMAP chart. Source: IntoTheBlock
On the upside, the supplier congestion zone between $94,980 and $99,680 poses a stiff barrier for the bulls. This is where approximately 2.13 million BTC were previously bought by roughly 2.36 million addresses.
Note that these price levels are just below or above the spot price, demonstrating the current tug-of-war between the bears and the bulls.
