Bitcoin’s upward momentum faces a significant challenge as on-chain data reveals a massive supply wall of 1.6 million BTC around the $97,200 level. This resistance could prove crucial for Bitcoin’s next price movement.
Understanding the Supply Wall
Market intelligence platform IntoTheBlock has identified a critical resistance zone between $96,400 and $98,400. About 1.6 million addresses hold 1.57 million BTC in this range. These holders are currently underwater on their investments.
Underwater investors often seek to break even. They tend to sell when prices return to their purchase levels. This behavior can create strong resistance zones.
Support Levels and Market Structure
Bitcoin’s closest support lies between $93,400 and $96,200. This support zone contains less supply than the resistance above. Below this level, support remains thin until $81,800.
The current market structure suggests:
- Strong resistance could limit immediate upside potential
- Weaker support levels might not hold during a significant pullback
- Price action may remain range-bound between $93,400 and $98,400
Market Implications
The presence of this supply wall creates several scenarios:
- A successful break above $98,400 could trigger a strong rally
- Failed attempts might lead to consolidation
- Extended rejection could test lower support levels
Traders should watch for increased volume near these levels. High volume breakouts often signal stronger trend changes.
The current price action suggests cautious trading. Investors might benefit from waiting for clear breakout signals above the resistance zone.
Tags: Bitcoin, Market Analysis, Trading, Resistance Levels, On-chain Analysis
Source: NewsBTC