Key Points:
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Retail traders are snapping up BTC during price dips both in the spot and futures markets; however, larger investors are selling off, which is stifling a stronger price rebound.
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The chances of a liquidation cascade around the $105,000 mark seem minimal, but investor sentiment is misaligned with trends reflected in cumulative volume data.
Bitcoin (BTC) and Ether (ETH) are both attempting to regain losses from the sharp sell-off that occurred from Saturday to Monday. Bitcoin saw a slight increase of 2.4% from $108,665, while ETH performed better, climbing 8.26% from its Monday low of $4,663.
Data indicates that many traders are buying the dips, though BTC prices remain trapped in a downward trend. A consistent cumulative volume delta of those categorized as retail traders (with 1k-10k holdings) shows ongoing net purchases from Sunday through Wednesday adjustments.
In contrast, larger traders, often referred to as “whales,” with holdings between $1 million and $10 million, were net sellers during this period. However, the rate of their sales decreased as they re-engaged around a BTC price of $111,000.
Diving deeper into the cumulative volume delta data, it appears that retailers in both Binance’s Bitcoin spot and perpetual futures markets are opening long positions during dips, while institutional traders are net sellers.
Retail activity is notable in the Coinbase Bitcoin Spot Market too, with net purchases reaching $11.253 million. Conversely, in the same timeframe, institutional investors on Coinbase and Binance were net sellers, offloading approximately $7.5 billion in the perpetual market.
It seems there’s a split in market dynamics—while large sellers exert pressure, retail and mid-tier players are attempting to stabilize prices by buying Bitcoin at lower valuations, possibly aiming to push back to the $117,000-$118,000 range. Still, Bitcoin is grappling with short-term downtrends, despite small positive shifts in cumulative volume data from Binance and Coinbase.
So, which comes first: $120,000 or $105,000?
Liquidation heatmap data indicates that during the weekend’s sell-off, there were absorption bids for Bitcoin in the $111,000-$110,000 range, with another cluster forming near $104,000.
Though it seems unlikely for prices to break down to the lowest liquidity cluster, the pressure from large orders well beyond the retail sector continues to impact BTC prices.
For those hoping for a period of market stabilization, it’s important to keep a close eye on the fixed, aggregated daily cumulative volume deltas to see if selling pressure subsides, and whether such shifts in volume correspond with changing investor sentiment.
This article does not offer investment advice or recommendations. All investment and trading actions come with risks, and readers should conduct their own research when making decisions.
