Bitcoin Market Depth Depleted Over Weekend, Signaling Potential Bottom: Hyblock Capital

According to Hyblock Capital, market depth, which refers to the collection of buy and sell orders both near and far from the market price, has been depleted over the weekend. This pattern is often observed at market turning points, suggesting the downtrend in Bitcoin since its August peak above $65,000 might be ending.

Liquidity, represented by market depth, measures the market's ability to absorb large trade orders without significantly impacting the price. It is typically influenced by several factors, including the time of day, current market events, and specific price levels.

Market bottoms are characterized by traders' reluctance to take decisive action, leading to a decrease in buy and sell orders and consequently lower liquidity.

Shubh Verma, co-founder and CEO of Hyblock Capital, told CoinDesk: "By analyzing the aggregate spot order book, particularly the 0%-1% and 1%-5% order book depth, we have found that low order book liquidity often coincides with market bottoms. These low order book levels can be an early indicator of a price reversal, often preceding bullish trends."