TLDR
- Bitcoin's price receded from $87,500, marking about a 2% decline in just one day, now dipping below the $85,000 mark.
- Speculation swirls around market manipulation by large holders, who reportedly use 'spoofing' to create fake resistance points.
- Liquidation levels are nearing $200 million, with $131 million of this tied up in long positions.
- Even amid volatility, Bitcoin ETFs have continued to attract investments, recording five straight days of inflows totaling $165.75 million.
- Technical charts suggest that Bitcoin might witness a further drop down to the $80,000 support region.
Following a recent peak of $87,500, reached on March 20, Bitcoin has fallen to slightly above $84,000, equivalent to a 2% slip in the last day.
The recent dip is happening alongside a surge in market liquidations, which have approached $200 million in the last 24 hours, with long position liquidations making up a significant portion.
Technical assessments reveal Bitcoin challenging a traditional resistance line, with price rejection patterns observed on the 4-hour chart hinting at potential extended setbacks.
Indicators of the market are showing a bearish trend, with the MACD and signal lines crossing negatively, ushering in a possible short-term sell-off.
Open interest in Bitcoin has diminished by 4.45%, hitting a low at $52.81 billion in futures trading. The long-to-short ratio has seen a slight uptick in bearish bets, currently standing at 0.9861.
Despite signals hinting at caution, the funding rates are still positive at 0.0051%, signifying ongoing bullish undertones towards long investments even when traders pay a premium.
The price dynamics seem influenced by movements from large investors. Research by Material Indicators implies that Bitcoin's difficulty in breaking through the $87,500 ceiling is largely due to market tactics. Large sell orders are cluttering exchange books.
$BTC Still fighting that Daily 200MA/EMA and previous support. Looking at the higher timeframe, the bulls would want to get back above $89K-$90K to really turn this around.
Maintaining a daily closure between $84K-85K is crucial to avoid another decline towards previous lows. https://t.co/28umCuHo6w pic.twitter.com/Lm7XshoqTr
— Daan Crypto Trades (@DaanCrypto) March 20, 2025
Spoofing is at play, where massive orders are placed without any true intention of executing them, falsely bolstering resistance levels and hindering upward trends.
The ratio of open interest to market cap has risen once again, indicating increased market leverage that could lead to a new bout of volatility and possibly mass liquidations.
Institutions Buy as Whales Suppress
On the institutional front, backing for Bitcoin appears to be solidifying. U.S. spot Bitcoin ETFs saw $165.75 million in net deposits on March 20, marking their fifth day of inflow.
BlackRock spearheaded the ETF investments with $172.14 million. Other major players like VanEck, Fidelity, and Grayscale Bitcoin Mini Trust also saw positive inflows, although some ETFs such as Bitwise and Franklin Templeton recorded outflows.
Considering the levels of support, a renewed bounce could see Bitcoin retesting local support around $83,000. Falling below that could push Bitcoin the price towards $78,350, which could signify a more significant correction from prior highs.
On the flip side, a rebound driven by bulls might reattempt the resistance trendline. Using Fibonacci retracement, a definitive breakthrough may extend to a target around $95,350.
Both the 200-day simple and exponential moving averages hover near $85,000, with bulls striving to transform these critical trendlines into supportive zones.
The European market sessions appear lackluster in momentum, giving credence to theories of suppressed price activity that negated earnings from the Asian sessions.
At this juncture, Bitcoin finds itself at a pivotal spot; traders are vigilant about whether it can overcome the perceived barricade at $87,500. Alternatively, it might face a sharper fallback towards $80,000 where previous buying has stepped in.
