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Bitcoin Whales Accumulate Despite Bearish Indicators

Bitcoin (BTC) finds itself at a pivotal point in this market cycle. While several factors hint at continued downside, others suggest a potential bottoming out of prices. Currently,

BTC trades at $57,700, having bounced back from last week’s low of $53,600. Despite this recovery, it remains in a technical downtrend from March’s record high of $73,800, with lower highs at $71,300 and $63,900.

Bearish Signals on the Horizon

Data from CryptoQuant indicates that a significant correction or the start of a sustained bear market could be imminent. The profit and loss index hovers around its 365-day moving average, a level that has previously preceded sharp declines in May and November 2021. Additionally, CryptoQuant’s bitcoin bull-bear market cycle indicator is nearing a critical level, hinting at a potential descent into a bear market.

Stablecoin Market Cap Stagnation

The stagnant market cap of tether (USDT) also suggests that a rally may be difficult to achieve. Historically, market recoveries have been linked to an increase in stablecoin liquidity. However, this growth has been lacking recently, adding to the bearish sentiment.

Bitcoin Whales Increase Holdings

Despite these bearish indicators, bitcoin whales have been actively increasing their holdings. Large BTC holders have boosted their stash by 6.3% over the past month, marking the fastest accumulation rate since April 2023. This activity suggests confidence among major investors even during the recent downswing.

Germany’s BTC Selling Nears End

Germany’s aggressive selling of seized BTC, primarily from the Movie2k case, appears to be winding down. The government has nearly emptied its wallet after seizing 50,000 BTC in January, which may reduce selling pressure in the market.

Bullish Factors to Watch

Several bullish factors could counterbalance the bearish signals. The potential approval of an ether ETF in the U.S. and the continued growth of U.S. stock indices, which have historically correlated with bitcoin, suggest that 2024 may see continued upside. Despite signs of short-term exhaustion, these factors provide a hopeful outlook for the coming year.

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Disclaimer: Not Investment Advice

it’s crucial to understand that the information provided here is not to be construed as investment advice. The crypto market is dynamic and highly speculative, and decisions should be made based on thorough personal research and consideration of individual risk tolerance. Always consult with financial professionals and conduct your own due diligence before making any investment decisions. The intention of this exploration is to present insights and trends, not to provide specific investment recommendations.

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