According to BlockBeats, on September 9, CoinDesk reported that the recent Bitcoin order book shows that the supply and demand dynamics of the largest cryptocurrency are sending potential price bottom signals and suggesting that the market is about to usher in a bullish turn.
Market depth — the collection of buy and sell orders, both near the current market price and at more distant prices — dropped sharply over the weekend, according to data from Hyblock Capital. That’s often a sign of a market turning point, suggesting bitcoin’s decline from late August highs above $65,000 may be coming to an end.
Market depth represents the market’s ability to absorb large trade orders without affecting prices. Market depth is usually affected by multiple factors, including the time of day, current market events, and specific price levels. Market bottoms are usually manifested by traders having difficulty making decisive moves, resulting in fewer buy and sell orders and lower liquidity.
“By analyzing the overall spot order book data, and specifically in the 0%-1% and 1%-5% spot order book depth ranges, we see a pattern: low liquidity in the order book often coincides with market bottoms,” said Shubh Verma, co-founder and CEO of Hyblock Capital, in an interview with CoinDesk. “These low order book liquidity levels are often early signs of price reversals, often signaling the emergence of a bullish trend.”
