When he began the opening weekly, the price of Bitcoin fell below us $ 9,000 in a rapid withdrawal, by liquidating $ 30 million in long only on BitMEX. According to the data of the market, part of the sale was the movement of the whales closing positions, which led to the panic in the sales among retail investors.
The whales, individual investors that possess a huge amount of Bitcoin, they have the ability to significantly impact the price of BTC and according to the data provider in the chain, CryptoQuantthe most recent sale is indicative of the beginning of a bearish trend in the market.
Ki Young-Ju, director-general of CryptoQuant, said:
“The reserves of BTC in Gemini reached its annual maximum a few days, and then began to decrease. This could be an opportunity to purchase locally in the short term, but in the macro vision, the tendency of the reserve seems to be low.”
Reserve of BTC Gemini. Source: CryptoQuant
The last time the reserves of BTC fell sharply to a price point crucial it was in February of 2020 when Bitcoin reached 10,500 dollars. In the following six weeks the price dropped to $ 3,600.
Reserve of BTC Gemini. Source: CryptoQuant
Why are they selling the “whales”?
There are three reasons why the whales feel the need to take advantage of the current price level. One is that the price of Bitcoin violently declined to 10,500 dollars two times in the last 11 months. The other is that it is expected that the difficulty of mining will see its largest increase since January of 2018, and the volume of trade cash is decreasing.
For the whales that have large amounts of Bitcoin, liquidity is key. If there are not enough buyers in the market and a great whale begins to sell, you may trigger a cascade of sales orders and settlements.
When the volume of the spot market is stagnant and the activity of the futures market increases, in the case of whales, it arouses the concern of a quick short-term fix.
For example, the 13 of march, the price of Bitcoin fell 50% overnight to below the $ 4,000 because the whales began to be sold to the highest. This led to a strong sale that ended with a USD 1,000 million in futures contracts to be settled in what is now the largest pullback of a day in the history of Bitcoin.
The whales seem to be getting benefits after a massive spike of 130% in the past three months. By doing this, you are able to safeguard your possessions and can also protect against a relatively low volume in the market of the criptomoneda.
As with previous sales, the main investors are also considering probably the current geopolitical risks and the volatility of the world stock market as external variables that can affect the market momentum of criptomonedas.
The entries of Bitcoin on the exchanges going back up while the stock market of the USA collapses. Source: CryptoQuant
What will happen to Bitcoin then?
From a technical point of view, Bitcoin has a simple structure in the short term. The loss of 9,000 dollars increases the probability of a fall to the range of support 6,000 to $ 7,500. Historically, 6,000, 6,400, 7,100 and 7,400 dollars have served as strong support levels.
For the moment, the analysts pointed to the whales of BTC in Coinbase and Gemini as the catalysts for the recent decline.
In a tweet, the head of strategy CryptoQuant, Mason Jang, said:
“The entries of BTC on the exchanges are rising again. 15,597 BTC have been flowing to the exchanges from the 15th June 02:00 UTC. The whales of Coinbase and Gemini moved just before the fall.”
With the Dow Jones Industrial Average (DJIA), and the major stock indexes of Europe and Asia continuing to the downside, a correction of Bitcoin in a period of uncertainty, as this can lead to a reaction, fierce among investors.
In the short term, investors will be watching to see if Bitcoin can get a close above the zone of 9,400 to 9,500 dollars.
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