The cost of Bitcoin (BTC) is showing overall weakness equally information technology struggles to establish $34,000 as a support level. Overall, BTC appears to be stagnating without signs of a short-term relief rally, leading traders to be cautious.

One apropos trend is that the volume of Bitcoin has been stagnating along with its cost, autonomously from the "Elon pump" on Jan. 29. This trend indicates that there is an overall drop in buyer demand since the $42,000 meridian despite BTC hovering in the low $30,000 region.

BTC/USDT 4-hr price chart (Binance). Source: TradingView.com

Bitcoin gets inclement after revisiting $38,000

On Jan. 29, the cost of Bitcoin rose to every bit high as $38,461 on Binance afterward Tesla CEO and the world'due south richest man, Elon Musk, ostensibly showed support for Bitcoin.

Even so, earlier this rally, on-chain analysts were already warning that the momentum of Bitcoin was slowing.

Ki Young Ju, the CEO of CryptoQuant, for example, pinpointed the high selling pressure from Bitcoin miners as a sign of a short-term surly scenario.

Although the cost of Bitcoin briefly surged xiv%, it snapped back down to sub-$34,000 within 24 hours. Hence, weakening on-concatenation indicators were likely a warning that BTC would retrace almost of its "Elon pump" gains.

Ki wrote before the rally:

"Commutation Whale Ratio hit the 8-month high, significant $BTC might have a large ruby-red candle if the cost drops. It'south supposed to be below 85% if this bull-run is legit. Otherwise, it'southward likely to be a bull trap."

Whales likely sold every bit the price of Bitcoin abruptly surged to the $38,000 resistance level, causing a sharp correction.

With shaky on-concatenation indicators and some selling pressure coming from miners, traders are also showing circumspection nearly longing BTC/USD in the near term.

A pseudonymous trader known equally "Salsa Tekila" said that he is not using leverage until Bitcoin breaks out or drops back to $30,000. He said:

"We're at that indicate where $BTC is far plenty from the 30k for me not to be comfortable longing with any form of leverage only at the same time I wouldn't short. Therefore being spot long until a big downward / legacy open / probably Monday morning is all-time. NO LEVERAGE"

Meanwhile, another pop pseudonymous trader known as "Byzantine General" argues that the rally is broken. Hence, fifty-fifty if Bitcoin is bullish in the macro picture show, more downside is possible until it sees a convincing breakout on lower time frames. He noted:

"The balderdash run is still on IMO, but the rally is broken. If we re-claim the yearly TWAP we tin continue ze pump, simply until then information technology looks kinda meh."
Bitcoin price nautical chart with TWAP level. Source: TradingView.com, Byzantine General

What to sentinel out for

Traders and technical analysts are closely observing Bitcoin's reaction to the $34,500 to $35,000 range.

If Bitcoin breaks out of it with strength, momentum, and loftier volume, then the probability of a short-term trend reversal rises.

Still, if Bitcoin struggles to retest the $34,500 resistance level and continues to stagnate in the $33,000 region, the risk of a further breakdown to the $33,000 support remains.

Crypto Fear and Light-green Index (78 or "extreme greed"). Source: Digital Assets Information

Boosted signs that BTC cost could come across another pullback include the Crypto Fearfulness and Greed index remaining at "extreme greed" levels and Google searches for "Bitcoin" dropping by l% since multi-twelvemonth highs seen earlier this calendar month.