Analysts say Bitcoin’s choppy price action is ‘typical of low liquidity markets’
On July 9 Bitcoin and the wider cryptocurrency market saw a moderate relief rally that helped recover some of the losses seen on Thursday but a handful of analysts continue to caution that BTC could still drop to the $24,000 to $29,000 range in the short-term.
BTC/USDT daily chart. Source: TradingView
Sentiment among traders received a slight boost after Bitcoin price reversed course and rallied back to $34,000 but the price still remains trapped between key resistance and support levels and the lack of buy volume is still a valid concern.
Tempting Beef, a pseudonymous trader on crypto Twitter, also pointed out that the total crypto market cap and altcoin market cap remain in a precarious position.
Elie Le Rest, partner at digital asset management firm ExoAlpha, also pointed out that along with the “non-directional trend” in BTC, the market is also “witnessing a decrease in trading volume” that has led to “more wild reversals within the range, hurting directional traders.”
Le Rest said:
Due to the market volatility, Le Rest sees market participants staying on the sidelines as they wait “for the Grayscale trust to stop offloading their Bitcoins and for the Chinese regulatory crackdown to cool-off.”
Le Rest also pointed to the scrutiny financial regulators all over the world are putting on Binance, as “a considerable problem that reduces the capacity of the market to get the capital inflow needed to break above $40,000.”
According to Le Rest:
While it’s true that BTC price fell below the weekly support level near $34,500, pseudonymous crypto Twitter analyst Rekt Capital was quick to point out that the price found support at another established support level near $32,200 resulting in “no major changes in the trend.”
Bitcoin entities net growth. Source: Glassnode
In times like these when uncertainty prevails, the simple strategy of dollar-cost averaging is one that even the most experienced traders turn to in order to decrease stress and re-focus on the long-term price outlook.
The views and opinions expressed here are solely those of the author and do not necessarily reflect the views of Cointelegraph.com. Every investment and trading move involves risk, you should conduct your own research when making a decision.
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