Doubts about Bitcoins [BTC] short term gains? Consider this
- Investors are getting impatient about Bitcoin’s short-term prospects.
- However, whales may have good news.
It has been over two months since Bitcoins [BTC] last YTD peak. It has lost its bullish momentum, causing investors to grow weary of its short-term outlook. BTC now risks investors losing confidence, which could lead to increasing selling pressure.
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Sometimes a change of perspective is all it takes to have a better view of the market. This is not the first time Bitcoin has experienced indecision at the press time price level.
Zooming out to a three-day chart revealed that the recent resistance level near $28,000 served as support in May 2022. The price was earlier in a descending path before sideways activity, which was then followed by a continued decline.
Source: TradingView
Will the opposite happen this time? The price has been on a bullish path since the start of 2023, and an extended upside can be expected if it continues to rise. So far, it has maintained healthy relative strength, and the MFI indicates that liquidity is still flowing into Bitcoin.
On top of that, a popular cryptoanalyst has recently highlighted observations that suggest the bulls may continue to dominate.
How much is 1,10,100 Bitcoins worth today?
Bulls may be ready for more dominance
Crypto analyst @CredibleCrypto believes that Bitcoin’s bullish expansion phase has already started. He also noted that the latest consolidation phase was 30% longer than the previous phase between 2019 and 2020. The analyst expects the next bull run to be particularly strong, based on the above observations.
The expansion has begun. This time after a period of consolidation that was ~30% longer than our last major rallies in 2019 and 2020. If you thought those rallies were strong, wait until you see this next… $BTC pic.twitter.com/MHP2jSbrXl
— CrediBULL Crypto (@CredibleCrypto) 9 April 2023
But do these expectations reflect things in the chain? Well, Glassnode’s data shows that the amount of BTC supply lasting more than 10 years is now at a new ATH of just over 2.7 million BTC. On top of that, whales seem to be buying. The number of addresses containing one or more BTC is now at a new ATH.
📈 #Bitcoin $BTC The number of addresses with 1+ coins just reached an ATH of 993,856
See calculation: pic.twitter.com/g0ka6ksGOY
— glassnode alerts (@glassnodealerts) 9 April 2023
A quick look at the supply distribution reveals that addresses with over 10,000 BTC in total have added to the inventory in the last 30 days. However, addresses with between 100 – 1000 Bitcoins trimmed their balances in the same period.
Source: Sentiment
The above observations do not necessarily exempt Bitcoin from selling pressure. The market was still on edge at press time, perhaps waiting for the next big signal that could provide some clarity of direction. Bitcoin exchange flows have decreased in recent days. This includes both currency input and output.
Source: CryptoQuant
On the plus side, demand for derivatives is still within healthy levels. Such low market moves are sure to attract some leverage activity in the demand for derivatives, as traders look to maximize gains in low volume market conditions. Bitcoin’s estimated leverage ratio has been slightly up since the beginning of April.
Source: CryptoQuant
Bitcoin’s open interest has increased significantly in recent days. More notably, it has been rising since late March. A continued upside could trigger a return of market confidence.
