Bitcoin Price May 'Tap Lower' as Trading Volume Declines and Macroeconomic Issues Loom

Bitcoin’s sell-off appears to be pausing despite new U.S. sanctions against Russia imposed on Feb. 22.

According to data from Cointelegraph Markets Pro and TradingView, the price of bitcoin (BTC) continues to hover just below the $38,000 level, which some analysts see as an important support and resistance zone.

Here's what analysts are saying about Bitcoin's price and what levels to watch in the short-term.

25% of entities are underwater

On-chain data provider Glassnode released the following graph, analyzing the proportion of profitable entities, and the analyst concluded: “The proportion of profitable on-chain entities fluctuates between 65.78% and 76.7%.”

As the chart above shows, "more than a quarter of network entities are now underwater," while "approximately 10.9% of network entities have a cost basis between $33,500 and $44,600."

Glassnode says:

"Should the market fail to establish a sustainable uptrend, these users are statistically the most likely to become another source of sell-side pressure, especially if prices are below their cost basis."

Prices may continue to "test low"

Further insight into the headwinds facing Bitcoin has been provided by cryptocurrency research firm Delphi Digital, which has previously noted that Bitcoin is "entering an area of daily, weekly and monthly resistance."

This resistance build-up prompted Delphi Digital to suggest that "due to the build-up of the resistance zone and the speed and magnitude of the move from recent lows, $45,000 is a logical place to expect profit-taking/de-risking activity," which, it turns out, was indeed The price dropped shortly after reaching that level.

According to Delphi Digital, Bitcoin’s price has “stalled over the past two weeks” and has yet to “recover any weekly support structure or the midpoint of the yearly range.”

Delphi Digital says:

“If the $40,000 level fails to hold, the next level in the market structure is around $38,500. If we lose that level, you can expect the previous lows to be revisited, with a good chance of lower prices.”

Whales Poised to Accumulate Below $38,000

On-chain analytics firm Whalemap provided a final bit of insight into the movement of Bitcoin whales, posting the following chart highlighting areas with significant inflows to BTC wallets over the past four months.

Whalemap says:

“The area of interest for whales is now very well defined. Below $36,000 to $37,000, wait at $34,000. Macro trend reversal above $48,500.”

Possible resistance areas identified on the chart above include major resistance levels at $40,000, $43,500, $46,500, and $48,500.

Bloomberg senior commodities strategist Mike McGlone offered one last hope for BTC bulls, posting the following tweet, suggesting that Bitcoin is currently being sold relative to “annual averages since 2020 and 2018 lows.”

The overall cryptocurrency market capitalization is currently $1.708 trillion, with Bitcoin dominance at 42.1%.