The recent price action underlines a lack of conviction in the market, with traders choosing to wait for clearer signals before taking new positions.
According to Bitfinex Alpha, the world’s largest cryptocurrency by market capitalization has failed to stay within its consolidation range between $106,000 and $116,000, while its purchasing power is declining.
The price movement shows little conviction from the bulls, leading to a decline in investor confidence and sentiment. The crypto asset briefly climbed to $116,000 last week, providing temporary relief for traders. However, long-term holders started selling, but major institutions did not step in to buy, leading to a price drop.
Traders are turning cautious amid shrinking price movements
The platform noted that price movements in the options market are becoming smaller. This suggests that traders are becoming uncertain about the direction of the leading cryptocurrency and are choosing to remain cautious after the big sell-off on October 10. The uncertain development has slowed down due to the general economic factors.
According to the update, the recent Federal Open Market Committee (FOMC) presented unclear signals on growth and inflation. These signals made investors less willing to take risks.
Despite remaining above the $106,000 support level, signs indicate that the market is weakening. Data from on-chain analytics shows that long-term investors sell approximately 104,000 BTC every month. This means that many traders take profits instead of holding them. Meanwhile, short-term traders are losing confidence as their profits shrink and new buyers are about to enter the market.
BTC Price Risks Drop Towards $100K Zone
Without a renewed flood of ETFs, BTC’s price will likely remain in the same range and could fall even further, just like Tuesday. At the time of writing, the digital asset is trading below $104,000, according to data from CoinGecko.
If BTC falls below that area, the asset could slide towards $100,000. However, if the price breaks above $116,000 on strong trading activity, it could be the first sign of a real recovery as November approaches.
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