Bitcoin price has dropped for four consecutive weeks and is hovering near its lowest level this year. It was trading at $68,245 on Wednesday, down substantially from its all-time high of $126,300 as demand waned. However, there are signs that whales have started buying, a sign of increased accumulation.
Bitcoin whales have started buying
BTC price continued its strong downward trend in the past few months, a trend that may reverse soon as whales start buying.
Data shows that whales bought 53,000 coins, currently worth over $3.65 billion last week. It was the biggest whale purchase since November last year. Wallets holding over 1,000 coins added coins worth $4 billion as the coin’s crash gained steam.
Still, analysts recommend caution in the crypto market as these whales have sold over 170,000 coins since December last year.
Another major risk is that the futures open interest has continued falling in the past few months, a trend that accelerated since October 10 when positions worth over $4.65 billion were liquidated in a single day.
Data shows the futures open interest has dropped from over $95 billion in October to the current $44 billion. Falling open interest is a sign that investors are largely staying in the sidelines.
At the same time, spot Bitcoin ETFs have started to gain assets in the past two days. These funds added over $145 million on Monday after adding $371 million on Friday. These inflows have reduced the overall outflows experienced this month to $173 million.
Spot Bitcoin ETFs shed over $3.4 billion in November, $1.09 billion in December, and $1.6 billion in January as the crypto winter continued.
The spread between the iShares Bitcoin ETF (IBIT) and the SPDR Gold ETF (GLD) has continued to wane in the past few months. IBIT now has over $54 billion, while the GLD has over $174 billion, a trend that has accelerated as the gold price rally has accelerated.
Meanwhile, Digital Asset Treasury (DAT) companies have remained in the sidelines in the past few months, with only a handful of them buying in the past few weeks. Strategy bought 27,234 coins in the last 30 days, bringing its total holdings to 714,644, which is worth over $48 billion. DDC Enterprise and Canaan bought 705 and 48 coins.
Strive bought 5,504 coins in the last 30 days, while American Bitcoin bought 416 coins. However, some companies like Empery Digital and Cango have sold 357 and 4,504 coins in this period.
Bitcoin price prediction: Technical analysis
The daily timeframe chart shows that the BTC price has remained under pressure in the past few months. It has remained below the Supertrend indicator, a sign that bears remain in control.
The coin has remained below the 50-day and 200-day Exponential Moving Averages (EMA). It formed a death cross pattern, which happens when the two averages cross each other.
The Relative Strength Index (RSI) has remained near the oversold level. Also, the MACD indicators have continued falling in the past few months.
Therefore, the most likely scenario is where the coin continues falling, potentially to the key support level at $60,000. A move below that level will point to more downside in the near term.
However, the rising whale buying could be a sign that bottoming is nearing.
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