Bitcoin whales lead the price of BTC around $25,000, and caution is needed, the analysis warns.
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spent another day hitting $25,000 on February 20 as analysts continue to warn against market manipulation.
Bitcoin boosted by “Notorious B.I.D.”
Data from Cointelegraph Markets Pro and TradingView showed BTC/USD making losses from around the weekly close to re-approach the $25,000 mark at the time of writing.
However, the bulls still couldn’t trigger a flip from resistance support, and whale activity on the exchanges kept suspicions high.
In its latest update, monitoring resource Material Indicators has revealed that large volume traders have artificially “reduced” overhead resistance, making it more likely that BTC/USD will move higher.
Co-founder Keith Alan referred to a wall of bid liquidity driving up the spot price, something he called the “Notorious B.I.D.” mentioned.
“Several rejections from $25k correlate perfectly with BTC macro TA which is a valid reason for TP at these levels, but Notorious B.I.D. is still trying to increase the price,” read a tweet.
“Based on the history, and the potential to turn the illiquidity on its head, I’m going for a long time.”
The Material Indicators added: “From a TA perspective, this should be a local top, but Notorious B.I.D. still runs the binance order book.”
“They are distributing BTC asking for liquidity from the range of $25k – $25.5k in the active trading zone so the resistance is decreasing,” also read part of the commentary.
A potential plan among these traders could be to trigger a big price run, causing retail investors to rally or go long, and then get stuck as the whales spread BTC into the market at higher levels.
China could give the crypto “liquidity junkie” a boost.
Meanwhile, with US markets closed for a holiday, one analyst turned to the long-term implications of a move out of China.
Related: ‘Snap Back’ for $20K? 5 things to know in Bitcoin this week
In addition to allowing Hong Kong retail investors access to previously banned crypto, the Chinese central bank injected a record $92 billion of liquidity into the economy on February 17.
“While most analysts are focused on how Fed tightening will reprice risk assets in this cycle, they fail to consider the magnitude of the decline in the East,” the popular Twitter account Tedtalksmacro argued in a thread.
She explained that unlike in the United States, where the Fed withdraws liquidity through quantitative tightening (QT), China does the opposite. In 2020, under the Fed’s COVID-19 quantitative easing (QE), risk assets, including crypto, experienced an 18-month run.
“Crypto is not tied to any particular economy or entity, but rather is a liquidity junkie – a desire for the risk-hungry investor to get cash and bet on the fastest horse. That’s exactly what it’s going to be in China this year happening,” the thread continued.
As Cointelegraph reported, US liquidity is already a key talking point when it comes to crypto asset performance, with Arthur Hayes, former CEO of derivatives giant BitMEX, predicting a further decline in the second half of 2023.
“Of course, not all the money injected by the PBoC [People’s Bank of China] will end up in risk assets. But I think a decent portion of it will!” However, Tedtalksmacro has closed.
“As we saw from the West in 2020, greater liquidity from central banks = rising prices of risky assets (like BTC).”
