The 200-week moving average could see another test from the bulls next, according to signals from exchange order book composition.
Bitcoin (BTC) consolidated higher on July 16 after the Wall Street trading week finished with modest gains for United States equities.
Can Bitcoin bulls reclaim the 200-week moving average?
The pair thus preserved the majority of its comeback from the week’s lows, these following shock U.S. inflation data and sparking weakness across risk assets.
Now, out-of-hours trading meant that the classic scenario of breakouts and fakeouts on thin liquidity could accompany Bitcoin into the weekly close.
Eyeing order book data from Binance, the largest global exchange by volume, showed key resistance clustered around the $22,000 mark should bulls attempt to nudge the market higher.
For monitoring resource Material Indicators, however, there was a distinct possibility that Bitcoin could even challenge its 200-week moving average (WMA), a key bear market trendline lost as support over a month ago.
— Material Indicators (@MI_Algos) July 15, 2022
“It’s easy to become bullish on BTC on a green day & bearish on a red day,” popular trader and analyst Rekt Capital added in separate comments.
“But $BTC is still just ranging between $19K-$22K. This will continue until either of these levels is broken Intra-range moves aren’t substantial enough to dictate changes in sentiment.”
As Cointelegraph reported, that sentiment achieved an unenviable record this week, as crypto markets capped their longest-ever period in a state of “extreme fear” as per the Crypto Fear & Greed Index.
Miners feel the pinch
Monitoring miner behavior, meanwhile, one analyst at on-chain analytics platform CryptoQuant sounded the alarm over a potential sell-off.
14,000 BTC was transferred from miner wallets on July 15, Binh Dang showed, and while not specifically indicative of selling, the phenomenon was worth tracking.
“At this point, we can not be sure that this distribution is positive or negative, so we should be careful to watch out for the next few days,” he summarized in one of CryptoQuant’s Quicktake market updates.
Separately, a new indicator, the Energy Gravity Model, covering Bitcoin production costs showed that miners were likely able to pay comparatively low amounts for energy in order to mine at a profit at current BTC spot prices.
“Bitcoin Energy Gravity is the maximum USD price ($ / kWh) modern mining rigs are willing to buy electricity at to make a profit. ie: breakeven electricity rate,” the model’s creator, BlockWare analyst Joe Burnett, explained in a Twitter thread.
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