Bitcoin

Bitcoin’s spread in bids and offers is the widest it has been in the past three months, according to recent reports.

Bitcoin’s order books are drying up as the leading cryptocurrency continues to be in the red.

As reported by skew (@skewdotcom), liquidity for Bitcoin is evaporating. In a sample of $10M, the gap between bids and offers is widening to levels not seen in months. Worst of all, it is happening during an exceptionally bearish move for Bitcoin on the weekly timeframe.

As Gabor Gurbacs (@gaborgurbacs) writes, investors would be smart to avoid any large market orders — the “market can snap fast [in] any direction,” he writes.

Low liquidity and thin order books could definitely spell further short-term pain (or possible gains) for Bitcoin. However, it all depends on market momentum.

Undoubtedly, a thin order book can easily exacerbate losses if a violent downward move occurs; inversely, however, a thin order book can also allow for an easier, quick uptick. In short, thin order books tell us that we can expect some serious market volatility, in general. So, as Gurbacs says, be careful.

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Bitcoin is currently down -1.46 percent on the daily at the time of writing, trading at around $7,150 at the time of writing. However, Bitcoin has already begun its slow ascent from the bottom it found earlier today at $6,650. The thin order books likely made the rise from $6,650 to $7,150 much faster than anticipated.

Despite Bitcoin regaining some losses today, it still remains in an obvious downtrend.


Images courtesy of Twitter, Shutterstock.


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Source: Be In Crypto