Bitcoin funding rates turn negative as whales continue to sell
Bitcoin (BTC) continues its consolidation above $23,000. The largest cryptocurrency on the market has been stuck in a range after what appeared to be an uptrend ready to break new annual highs and climb to the $30,000 level.
As of press time, BTC has failed in another attempt to break above $23,900 and consolidate above $24,000 to target the ultimate wall of resistance for the bears at $25,000.
A confluence of negative funding rates and whale selling pressure has pushed BTC’s price lower. Will the bulls have another chance to break through the upper resistance walls and continue the uptrend?
Bitcoin Bulls Have Thrown in the Towel?
According to a Twitter mail by chained data analysis firm LookIntoBitcoin, BTC’s funding rates have turned negative, indicating that most traders on the cryptocurrency’s main exchanges have taken positions “betting on a price decline.”
As the data shows, traders “bet” to go to the downside; given the recent crypto crackdown by the Securities and Exchange Commission (SEC) and the potential bankruptcy of crypto-friendly bank Silvergate, Bitcoin price action may be headed for lower levels. Still, market makers could chase that liquidity and lead to a rally to the upside.
Eight Global CEO and full-time trader Michael Van de Poppe addressed the market’s current circumstances, saying that if BTC fails to hold the $23,200 support level, the largest cryptocurrency on the market is likely to test $22,000 before moving higher. Van de Poppe explained:
Silvergate could potentially go bankrupt, pushing prices down a bit more. On the other side; people piling up positions since the news and no real movement on Bitcoin. This could be an assumption that people are strongly biased towards the short side here. Time for a hug.
Furthermore, as shown in the chart above, selling pressure from whales has increased since May 2022, despite the market’s recovery. Crypto addresses with more than 1000 BTC had continuously sold their BTC, which intensified after the FTX debacle and current actions by the SEC.
After more than a fortnight, Bitcoin continues its sideways movement with high expectations from investors for further profits. BTC has rallied 60% since December 2022, and it has claimed its 200 moving average (MA) as solid support to reclaim new yearly highs.
Bitcoin is trading well above $23,000, showing strong support. At the time of writing, Bitcoin is trading at $23,400; it has decreased by -0.6% in the last 24 hours.
The sideways price action has affected higher timeframes, with the seven-day timeframe showing a 2.9% decline. Over the past fortnight, BTC has experienced a significant price decline of -3.6%.
Featured image from Unsplash, chart from TradingView.com.
