The price of Bitcoin (BTC) has experienced volatility in the last 12 hours. The major cryptocurrency fell from $ 16,400 to $ 15,750 in a matter of hours, sharply rejecting after breaking the resistance of $ 16,000 earlier this week.
As of November 14, Bitcoin’s 20-day moving average on the daily chart is $ 14,600. In the short term, if a pullback occurs, the $ 14,600 level remains a favorable area for buyers.
An algorithmic trader known as “CryptoGainz” explained that the current structure of the Bitcoin market likely triggered a sell-off. The trader pointed out the abundance of sell orders at $ 16,500 that did not decline when BTC reached $ 16,400.
This could indicate that sell orders at that level are not counterfeit orders. So it could show that sellers are actually trying to make a profit from BTC at around $ 16,500.
Why $ 16,500 is a problem for Bitcoin in the short term
When traders or bots try to cheat the Bitcoin market, they place fake orders at key support or resistance levels.
For example, If traders place large fake orders near a resistance level, there is a chance that buyers will not break through the resistance. Therefore, fake orders could be used to artificially boost or restrain the momentum of a market.
“Requests” or sell orders above $ 16,500 have not disappeared during BTC’s recent rally. With this in mind, the probability of $ 16,500 acting as a high level of resistance in the near term remains high.
When BTC was hovering around $ 16,200 before the Bitcoin price crash occurred, the pseudonym trader explained:
“I wouldn’t say we’re going to make nuclear bombs, but at this point smart proprietary entities with a lot of capital and intellectual property of a certain nature realize that 16.5k applications have been resting there for a long time and it doesn’t seem to be coming up with. the price very close to there. “
/ The trader pointed out that the algorithms could move to “look for” long contract stops if it was profitable to do so. Based on the rapid decline of BTC in a short period, that is likely what happened when BTC fell below $ 15,800. The trader added:
“That is, if there is an algorithm that can cost-effectively lower the price and eliminate longs, the conditions for its use are possibly being designed so that the maximum amount of profit is extracted. tl; dr – as soon as it is profitable to seek long (contracts), your stops will be taken. “
Where can the BTC price go next
Cantering Clark, a Bitcoin trader, said a retest of $ 13,000 could occur despite strong momentum from BTC. The wrote:
“I love being loud to everyone else when shit is pumping, but I’m securing the bag and playing short-term just right now. Feeling that we are heating up, I think the market inflicts more pain on the downside soon than on the upside. Spot players are not easy. “