Bitcoin (BTC) may have hit $37,000 for the first time in 18 months, but traders are growing wary of BTC’s price action.
BTC price movement “doesn’t feel right”
After sudden overnight gains, Bitcoin is trying to break resistance on its way to the $40,000 mark.
Data from Cointelegraph Markets Pro and TradingView shows that BTC/USD is approaching $37,000 after initially breaking out before Wall Street opened.
Now, up 6.6% in November, the largest cryptocurrency is surprising some market participants with its strength, having already gained nearly 30% in October.
For the Material Indicators on-chain monitoring feature, the problem lies in trading volume. The rise has been rapid, as recognized in its last https://twitter.com/MI_Algos/status/1722585964302782948/photo/1 on X (formerly Twitter), but support in the form of strong volume is not visible at current levels.
“Support is anchored by new downside protections at $33,000. Meanwhile, resistance at $40,000 has risen into the $42,000 range,” he noted.
An accompanying chart showed an impression of BTC/USDT order book liquidity on the largest global exchange, Binance.
“There’s no denying the fact that price is defying a number of different local top signals, but there’s also no denying that something doesn’t feel right about this move,” continued Material Indicators.
“The most obvious sign to me is that we are seeing the price appreciate on declining volume. This usually doesn’t end well, but we’ll have to watch to see if this time is different.”
Meanwhile, popular trader Skew revealed that whales are selling towards $40,000 – now likely a key psychological level in its own right.
Open interest nears seven-month high
Elsewhere, financial commentator Tedtalksmacro pointed to rising open interest (OI) – something that has been the backbone of rapid upward moves in recent weeks and months.
According to data from monitoring resource CoinGlass, total open interest in Bitcoin futures stood at over $17 billion at the time of writing – the highest value since mid-April.
“During a bear market, the market ignores these OI impulses –> a predatory and swinging environment,” wrote Tedtalksmacro in a follow-up analysis.
“We’ll know it’s time for a full rally when the market ignores this and moves higher with a higher OI. Something to keep an eye on, in my opinion.”
This article does not contain investment advice or recommendations. Every investment and trading decision involves risk, and readers should conduct their own research when making a decision.