Bitcoin's $18,600-$21,000 Range

The cryptocurrency Bitcoin is fluctuating between the values of $18,600 and $21,000 as it occupies a range in which it is currently located.

Bitcoin’s price seems to be forming a new range around its current levels as the cryptocurrency moves between the $18,600 and $21,000 area. BTC’s price has seen some recovery during today's trading session and might experience some volatility due to the U.S. Independence Day, July 4th.

Bitcoin currently trades at $19,500 with a 4% increase in value over the last 24 hours.

BTC trends to the downside on the 4-hour chart. Source: BTCUSD Tradingview
On the 4-hour chart, BTC is trending downward. Source: BTCUSD Tradingview

According to analyst Ali Martinez, the number of Bitcoin held by addresses with between 100 and 10,000 BTC has increased. These whales have been buying over 30,000 BTC.

Martinez also reports that over 40,000 BTC were withdrawn from cryptocurrency exchanges. The less Bitcoin is on these platforms, the less it can be sold on the market.

The market dynamics caused this weekend's price action. In addition, Material Indicators shows an increase in buying pressure from investors with a large bid (purple in the chart below) that coincides with short-term whale accumulation.

The whales have been the "most influential" over the BTC's price action and could be hinting at more gains. Material Indicators also recorded bullish momentum on the weekend's price action.

In fact, every investor class except retail and large whales with over $1 million in bid orders seems to be following BTC's price action, as shown in the chart below.

Bitcoin whales (purple) buying into BTC’s price action. Source: Material Indicators
Bitcoin whales (purple) are buying into BTC's price action. Source: Material Indicators

Additional data from Santiment show a spike in the number of long positions across exchange platforms. This is consistent with the U.S. holiday, but it may not be good news for these operators:

In the early hours of 4th of July 2022 in the US, there has been a massive uptick in #longs on exchanges in the previous hour. Trader optimism often correlates with holidays, which means there needs to be a greater degree of cautiousness of whales punishing the overly eager.

The Bitcoin market has been experiencing a lot of pain because of this factor.

There are some signs of possible bullish price action in the short term, but the increase in long positions is a reason for caution. The macroeconomic outlook seems less optimistic and could result in further pain for Bitcoin and other cryptocurrencies.

QCP Capital, a trading desk that claims to be bullish on the U.S. economy, says it is becoming less optimistic as the Federal Reserve (Fed) aims to slow down inflation in the country. The financial institution has been raising interest rates for that purpose and this has had a negative impact on global markets.

At first, some experts believed that the Fed would attempt to conduct a "soft landing", bringing down inflation without harming the economy. This possibility might have been ruled out as the Fed finds itself between a rock and a hard place.

Fed Governor Williams stated the “need to get real rates above zero”. This means that the Fed is likely to ignore recession risks and will keep raising rates aggressively to reach their target of 3.5%-4% by year-end.

In addition to the above, financial institutions have been reducing liquidity off global markets while shrinking their balance sheet. This only signals more downside for the crypto market.