- BTC’s recent rally could stall amidst rising sell pressure, as per Coinbase analysts
- QCP Capital and Coinbase analysts projected a range-breakout in Q4 2024
On Friday, Bitcoin [BTC] climbed higher on the charts and hit a monthly high of $67.3k, despite an overall meltdown across U.S equities.
However, Coinbase analysts have a word of caution to share. According to them, the recent gains could attract profit-making and “limit price move to the upside.”
In fact, part of the exchange’s weekly market commentary read,
‘We have seen an increase in the amount of total sell orders placed within 5-10% of the mid price. That suggests that we may be seeing some profit taking at current levels and/or a greater willingness by market participants to sell into price appreciation’
Source: Coinbase’s Market Depth
For perspective, market depth tracks the amount of sell (ask) and buy (bid) orders. Positive values in USD denote buy orders, while negative values track sell orders.
The attached Coinbase chart revealed a significant drop in market depth between 16 -18 July, with increasing asks (sell orders). In the short-term, this could put more downward pressure on the cryptocurrency’s price.
More Bitcoin sell volumes
The aforementioned trend was also recorded across most exchanges, especially on the derivatives side. As per CryptoQuant’s data, for instance, sell volumes eclipsed buy volumes on Saturday, as shown by the declining Taker Buy Sell Ratio.
Source: CryptoQuant
This metric, which divides buy volumes by sell volumes, signaled bearish sentiment at press time after dropping below 1 on the charts.
Meanwhile, Coinbase analysts believe that the likely profit-taking during the recent rally fit well with its choppy and range trading forecast for Q3 2024. However, they also believe that a rally is still feasible in Q4 of 2024.
This forecast is consistent with that of QCP Capital’s analysts too. In a Friday note to its Telegram community, QCP Capital analysts noted,
“While spot could range here in the near term, especially with dealers very long the 26-Jul 67k Strike, the market is definitely betting big on a breakout heading into the US elections.”
On the price front, at press time, the cryptocurrency was yet to mount above the obstacle and daily breaker block, marked red, near $67.5k.
If bulls clear this hurdle, a swift retest of the range-highs at $71k would be likely.
Source: BTC/USDT, TradingView