Bitcoin's Post-Halving Surge Stalls as Automated Algorithmic Selling Dominates Market

Bitcoin's post-halving rally faced resistance on April 22 as automated trading algorithms initiated BTC sales, causing a squeeze in bid and ask prices. Despite reaching weekly highs of $66,546, BTC momentum waned due to an imbalance between buyers and sellers, indicated by a "sea" of algorithms selling against individual bids.

Bitcoin's Post-Halving Rally Falters Amidst Automated Trading Algorithm Sales

April 22, 2022 - Bitcoin's (BTC) post-halving comeback hit a roadblock at the Wall Street open as a surge of automated trading algorithm sales weighed heavily on the market.

Market Momentum Wanes After Weekly Highs

Data from Cointelegraph Markets Pro and TradingView revealed that BTC's price momentum lost steam after reaching weekly highs of $66,546 on cryptocurrency exchange Bitstamp. Despite a promising recovery from the prior week's lows, Bitcoin faced stiff resistance, with buyers outnumbered.

Popular trader Skew, who now posts on the social media platform X (formerly Twitter), summarized the situation, stating, "So far spot flow is basically just one individual bidding vs a sea of algos selling. Could be a boring session till later."

Skew had previously noted that liquidity was moving closer to the spot price, often an attempt to entice market participants.

Liquidity Squeeze and Moving Average Support

The latest data from CoinGlass, a cryptocurrency market data aggregator, showed a concentration of bids between $64,000 and $65,500 on April 22, while fresh ask liquidity was stacked between $66,500 and $67,750.

Skew raised concerns about the legitimacy of these orders, stating, "Time will tell if they're spoof orders."

Analyst Matthew Hyland highlighted that a key moving average, the 10-week simple moving average (SMA), was holding at the latest weekly close. Bitcoin's 10-week SMA has acted as a significant bull market support line, supporting the market since October 2023. At the time of writing, the 10-week SMA stood at $65,686.

Potential Long Liquidation Hunt

BTC price action aligned with a theory put forward earlier in the day by popular trader and analyst Credible Crypto. He suggested that BTC could retreat to liquidate long positions before definitively reversing upward. Credible Crypto pointed out that open interest (OI) was already increasing.

In an X post, he explained, "If this move up falters before it really even begins then I'd expect something like this to develop." He accompanied the post with an illustrative chart, indicating a potential move back down to eliminate long positions before a "real" pump.

Disclaimer: This article is for informational purposes only and should not be construed as financial advice. Cryptocurrency trading involves significant risk, and investors should conduct their own due diligence before making any investment decisions.