Why is Bitcoin price stuck?

Bitcoin price has fluctuated between $57,814 and $61,815 for nearly seven days, as the 50-day simple moving average (SMA) at $61,662 remains stubborn resistance.

Data from Cointelegraph Markets Pro and TradingView shows Bitcoin price trading at $59,468, down 0.36% amid lower trading volumes, suggesting an extended consolidation period.

  BTC/USD daily chart. Source:  TradingView

Let’s look at the reasons why BTC price remains stuck today.

Weakness in spot demand for Bitcoin

Bitcoin’s whipsaw price action over the last week can be partly attributed to “weakness in spot demand,” as revealed by data from Glassnode.

Analyzing the cumulative volume delta (CVD), Glassnode estimated the current net balance between buying and selling in the Bitcoin spot market to investigate whether there is any directional bias.

The market intelligence firm noted that “there has been a consistent regime of net sell-side pressure” since Bitcoin hit a new all-time high on March 14, evidenced by a negative adjusted spot CVD (30d SMA), as shown in the chart below.

“The recent failure to break above the $70k zone can be partially explained by weakness in spot demand (negative adj-CVD).”

Bitcoin spot CVD vs. BTC price. Source: Glassnode

Negative CVD values suggest a net buy-side pressure, suggesting that the market is experiencing a sell-side bias.

“Activity in spot markets shows that there has been a net bias toward sell-side pressure of late, and this has not yet completely subsided.”

According to Glassnode, demand in the spot market would recover once the adjusted CVD metric crosses the zero line into the positive region.

If this happens, Bitcoin could potentially move out of consolidation to clearthe $70,000 to $72,000 supplier congestion zone and enter price discovery.

Bitcoin price is pinned under the 50-day SMA

On Aug. 5, Bitcoin price fell below the critical support provided by the 50-day simple moving average (EMA), fueled by the unwinding of the Japanese yen carry trade and fears of a global recession.

Several attempts have been made to reclaim the said level, but each has failed to spark a broader price trend.

Instead, BTC has gone ahead to produce a death cross on the daily chart, “with the 50 MA crossing below the 200 MA, signalling short-term weakness in the market,” declared popular Bitcoin trader Mags.

This is the second death cross since the FTX-led crash to $15,500, with the last death cross occurring in September 2023, when the price was trading around $25,000.

Mags explains that Bitcoin price traded “sideways for a few weeks” following this cross “before reclaiming the moving averages,” resulting in a golden cross and massive move upward.

“If the pattern repeats, we might see a few weeks of choppy PA here. The bullish confirmation will be a reclaim of the MA's followed by a nice bullish cross.”

BTC/USD chart. Source: Mags

The drop below the 50-day SMA saw Bitcoin whales buying into a block of ask liquidity below this level, according to FireCharts shared by trading resource Material Indicators.

According to Material Indicators, Bitcoin whales are still buying, but are running into some friction as ask liquidity dampens upside liquidity.

“If BTC bulls don’t bring the momentum to push to and through $65k, they will need to stack more bid liquidity above $58k to keep the range elevated.”

  Bitcoin Firecharts. Source: Material Indicators

Bitcoin is stuck between two significant levels

On Aug. 15, Bitcoin price reclaimed the $59,000 level, fueled by the anticipation of the first interest rate cuts by the US Federal Reserve in September.

Several attempts have been made to push the price above $60,000, but each has been curtailed by stiff resistance on the upside.

As such, Bitcoin remains stuck despite “positive CPI print,” according to MN Capital founder Michael van de Poppe.

Van de Poppe shared the following chart showing that Bitcoin price is stuck between $60,000 and $60,750.

“At this point, we’re looking at a case where we’re seeing a consolidation. As long as Bitcoin holds above $56-57K, everything is fine.”

  BTC/USD 12-hour chart. Source: Micheal van de Poppe

Van de Poppe’s observations were corroborated by data from Coinglass which shows high bid and ask orders building up on either side of the spot price. Currently, there are approximately $102.23 million ask orders between $59,830 and $60,400. On the other hand, roughly $246.95 million bid orders are sitting between $59,120 and $57,000.

Note these price levels are just below or above the spot price, suggesting that there is a tug-of-war between the bears and the bulls.

Bitcoin 12-hour liquidation heatmap. Source: Coinglass

Additional data from market intelligence firm IntoTheBlock helps to explain the ongoing stalemate between buyers and sellers. Its in/out of the money around price (IOMAP) model reveals that the price is currently between two significant levels.

There is robust support around the $57,783 to $59,523 demand zone, where approximately 337,150 BTC were previously bought by 1 million addresses.

On the upside, the supplier congestion zone between $59,600 and $61,340 poses a stiff barrier for the bulls. This is where approximately 896,860 million BTC were previously bought by roughly 1.55 million addresses.