Why Bitcoin [BTC] is due for a bullish relief mid-week, according to these findings
- Bitcoin bulls made another attempt to take over from the bears.
- Whale accumulation resumed after weeks of outflow.
Bitcoin [BTC] enthusiasts will be pleased to know that at press time bulls were once again battling for dominance after prices fell towards short-term support. Several observations have already suggested that a mid-week bullish reversal could be on the cards.
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Let’s start by considering the latest data on the chain. According to Glassnode, on May 9, daily on-chain exchange flows and net outflows outweighed the inflows. In other words, more Bitcoin is flowing out of exchanges than the amount flowing into exchanges.
📊 Daily exchange flow on the chain#Bitcoin $BTC
➡️ $571.3 million in
⬅️ $696.3 million out
📉 Net flow: -$125.0 million#Ethereum $ETH
➡️ $552.1 million in
⬅️ $759.4 million out
📉 Net flow: -$207.3 million#Tether (ERC20) USD USD
➡️ $807.8 million in
⬅️ $828.9 million out
📉 Net flow: -$21.1 million— glassnode alerts (@glassnodealerts) 9 May 2023
Bitcoin’s exchange flow data demonstrated a similar outcome, confirming a build-up of buying pressure. The latest data revealed that Bitcoin exchange outflow volume outweighed exchange inflow volume by just over 4,000 BTC.
Source: Glassnode
Are these exchange flows enough to trigger a price pivot? Well, the answer will largely be determined by whale activity. Strong demand from whales will certainly affect the direction of the market.
As such, it is important to take a closer look at what whales do.
Bitcoin whales strike
Bitcoin addresses with at least 1000 BTC have accumulated in the last four days. This confirmed that the recent exchange of exchanges was supported by favorable whale activity. On the other hand, Bitcoin Purpose ETF Holdings continued to sell.
Source: Glassnode
The reason for the ETF exits remains unclear, but it may be related to the uncertain regulatory environment in the US. Many crypto companies are exploring alternative options such as moving their operations overseas, and this can be discouraging for institutional investors.
Retail demand is also leaning to the positive side. Last week we saw a decline in daily active addresses to the lowest level during the Monday trading session. However, the last 24 hours were characterized by an increase in the number of active addresses. This may indicate that the market was in the process of regaining some confidence at the time of writing.
Source: Sentiment
The combination of renewed retail trade supported by healthy demand from whales could give the bulls an edge. However, these factors have not triggered a pivot in BTC’s price action, at least not yet. This is probably because there is still considerable selling pressure in the market.
How much is 1,10,100 BTC worth today?
A look at Bitcoin’s price action reveals that bullish demand manifested near a short-term support near the $27,000 price range.
Source: TradingView
While the above analysis reveals the ongoing battle for dominance between the bulls and the bears, it does not necessarily guarantee a victory for the bulls. The final result will ultimately depend on the level of buying or selling pressure prevailing in the market.
