Bitcoin: Will sell pressure hinder BTC’s growth?

• Bitcoin faced a challenging barrier with increased sell orders between $43,500 and $45,000.
• Bitcoin’s put-to-call ratio and prices declined.

The recent surge in Bitcoin’s [BTC] price has been a beacon of optimism for many investors.

However, as the cryptocurrency community eagerly awaits the potential introduction of Exchange-Traded Funds (ETFs), a growing number of traders are taking strategic measures to mitigate risks in an evolving market landscape.

Order, Order!

Bitcoin, at press time, was grappling with a large concentration of sell orders, particularly in the price range between $43,500 and $45,000.

This surge in sell orders poses a formidable challenge for buyers, making it increasingly difficult for taker bids to break through this critical range effectively.

The question that looms large is whether this concentration of sell orders signifies a resistance level in the market.

In response to this market dynamic, traders are adopting cautious strategies to navigate the evolving landscape.

The heightened challenge posed by the accumulation of sell orders prompts a reevaluation of the potential impact on Bitcoin’s growth trajectory.

Traders, in anticipation of the unfolding market conditions, are actively adjusting their positions to align with the prevailing challenges.

More and more sell orders are placed between $43,500 and $45,000. It appears increasingly challenging for taker bids to break through this range effectively.

Data by @MI_Algos pic.twitter.com/X3dmiSyVkH

— Maartunn (@JA_Maartun) December 30, 2023

Taking a closer look

A crucial indicator of market sentiment is the put-to-call ratio surrounding Bitcoin. In recent days, this ratio experienced a modest decline, falling from 0.48 to 0.46.

Further insight into Bitcoin’s market dynamics can be gleaned from its 25-day delta skew, which has materially fallen over the past few weeks.

In the context of financial markets, the 25 delta skew refers to the volatility skew for options with a 25% delta. Delta is a measure that gauges the sensitivity of an option’s price to changes in the underlying asset’s price.

A negative 25 delta skew suggests a higher probability of a downward price movement.

Source: Velo Data

State of BTC

As of the latest market update, Bitcoin was trading at $42,544.09, reflecting a slight decline of -1.13% in the last 24 hours. Delving into on-chain metrics, Bitcoin’s MVRV ratio had fallen, although it remained relatively high.

Read Bitcoin’s [BTC] Price Prediction 2023-24

This suggested that while the market may be experiencing a degree of profit-taking, a substantial number of addresses are still holding Bitcoin at profitable levels.

Additionally, the growth in daily active addresses indicated ongoing interest and engagement within the Bitcoin network, which could contribute to its overall resilience.

Source: Santiment