Bitcoin (BTC) has seemingly reclaimed $70,000 as a support level, but the market remains cautious as technical indicators hint at a potential bull trap. According to crypto trader Ardi, Bitcoin’s sell-side liquidity has surged to a two-month high, with $1.57 billion in sell orders stacked above the current price, compared to $1.125 billion in bids below.
A Heavy Supply Layer
Within a 5% band around the spot price, sell orders exceed demand by approximately 40%, creating a heavier supply layer above the market price. This imbalance is reminiscent of the setup seen in January 2026, when Bitcoin briefly broke above $98,000 before retreating. A similar sequence followed Bitcoin’s recent move above $72,000, which was followed by a slip back toward the middle of its range.
Profit-Taking and Positioning Metrics
Elevated ask liquidity during a retest often signals that traders are using rebounds to take profit. This is supported by another positioning metric: the 30-day moving average of Bitcoin’s net taker volume, which remains positive at $83 million in March. This indicates increased buying activity through market orders, suggesting that while there is demand, it is not sufficient to absorb the higher sell-side liquidity.
Underwater Supply and Market Psychology
The average cost basis for short-term holders (STHs) of Bitcoin is significantly higher, sitting near $88,900. According to Bitcoin researcher Axel Adler Jr., the largest supply cluster lies between $86,000 and $99,000, where many coins were accumulated between November 2025 and February 2026. This range forms the main breakeven area for a large share of the short-term market, making it a critical inflection zone.
Reducing Selling Pressure
On a positive note, realized profit and loss data show that selling pressure has begun to ease. Crypto analyst Darkfost noted that about $611 million in realized losses were recorded against $346 million in profit last week, bringing the net weekly profit-and-loss to -$264 million. This is a significant improvement from the $2 billion weekly loss recorded during the February drop below $60,000.
Looking Forward
A move back above the $70,000 to $72,000 range has alleviated some near-term selling pressure, but a more substantial shift may require Bitcoin to reclaim the $86,000 to $89,000 range. This is where most short-term holders reach breakeven, potentially leading to a more balanced market. For now, the market remains in a delicate position, and traders will be watching closely for any signs of a breakout or further consolidation.
About the Author
