Bitcoin (BTC) price fell sharply on November 26th after a whale sell-off. The records of the data chain companies Santiment, Intotheblock and CryptoQuant show a high level of exchanges between whales.
Selling by whales just below the all-time high for Bitcoin priceespecially if the market sentiment was too euphoric, led to a massive crash. Futures contracts worth approximately $ 1.8 billion were eliminatedas reported by Cointelegraph.
Some exchanges, such as Binance, recorded settlements worth $ 400 million in just a few hours.
According to Santiment Whales quickly sold after Bitcoin price topped $ 19,300. Many of these high net worth individuals sold themselves so aggressively that they no longer belong to the category of whales holding more than 1,000 BTC.
The overfunded derivatives market began to collapse as soon as the price of Bitcoin saw a relatively small decline. Eventually, the price of Bitcoin on major exchanges fell to just $ 16,200. Santiment analysts they said::
“$ BTC whales with 1,000 or more coins in their possession (currently $ 16.7 million or more) were sold almost immediately after peaking at $ 19.3 thousand two days ago. 11 of these whales were sold enough to fail to do.” be more in the “more than 1,000 coins” category just as prices were peaking. “
The intotheblock researchers they discovered a similar trend. The fall in Bitcoin prices coincided with the moment the whales transferred 93,000 BTC to the exchangess. When the price of Bitcoin hit its annual high, 93,000 BTC was worth $ 1.8 billion.
That decline started as soon as whales started depositing BTC on exchanges. More than 93,000 bitcoins were deposited on central exchanges. pic.twitter.com/ntq1yIlDeV
– intotheblock (@intotheblock) November 27, 2020
This crash started as soon as the whales started transferring BTC to exchanges. More than 93,000 Bitcoin were deposited on central exchanges.
After the rapid collapse of the Bitcoin futures market, the outlook for Bitcoin traders and analysts remains divided. Some believe that BTC is headed for a deeper retreat, possibly the USD 13,800 support level.. Other, but still, say buyers now have the incentive to push the price of Bitcoin above $ 18,000 Use liquidity.
Short-term bearish cases for the Bitcoin price
The pessimistic case of Bitcoin in the short term is mainly about two things. First, During the previous bull markets, Bitcoin historically fell 30% or more before the rally continued. If BTC performs similarly, it would represent a drop of at least $ 14,500.
Second, Short-term investor activity increases as the Bitcoin price consolidates. In the past, an increase in the number of recent addresses has been a downward trend.
Cryptocurrency trader and technical analyst Edward Morra stressed this Previous bull markets had multiple corrections that were even more severe, between 30% and 40%. In addition, the dealer said that too The Fibonacci sequence level of 0.618 is $ 13,500.
Based on the combination of these two data points, Morra explains this A drop to $ 13,500 would be a “fantastic” opportunity. Said::
Assuming we are in a bull market, Fibonacci 0.618 usually offers fantastic buying opportunities. Let’s take a look at the period from mid-2015 to the end of 2017. 6 out of 7 retracements we had reached 0.618 Fibonacci (the last retracement only reached 0.5). All falls were 30-40%. Currently, the Fibonacci level of 0.618 is around $ 13,500. That would be a fantastic buying opportunity if it happens. We already had a miniature version of it earlier this year, which was also corrected to 0.618 Fibonacci. “
Meanwhile, Josh Olszewicz, a chartist and cryptocurrency investor, says that ILocal bitcoin caps usually occur when one to three months of unspent transaction outflows (UTXOs) hit 10%..
investor mention, that What This factor is currently 8%, which historically means maximum market capitalization. He noted that “like the BDD, recent currency moves in the chain are generally bearish”.
Bullish cases in the near future
Market sentiment around the price of Bitcoin remains optimistic overall. Many analysts, assuming that the price of BTC will fall in the short term, continue to expect the dominant cryptocurrency to hit an all-time high by the end of the year.. With this in mind, some traders are also optimistic about the short-term price development of the BTC price.
A merchant whose pseudonym is known as the “Byzantine General”. he showed What Bitcoin’s liquidity is now in the range of $ 17,500 to $ 19,000. liquidity occurs when futures market traders lean to one side of the market. With liquidity higher, it suggests that traders are likely to be shorting BTC and liquidation prices for overfunded short positions are close to $ 18,000.
Stopping cascade hunts and sales can work either way. If the massive sell-offs of long contracts caused BTC to fall on November 26th, the short sell-offs could lead to a rebound in Bitcoin price. With the BTC / USD pair down significantly in a short period of time, a relief rally is certainly possible. With liquidity close to $ 18,000, the likelihood of this remains high.
Former Credit Suisse banker Mira Christanto added What The medium- and long-term outlook for the Bitcoin price remains good. He pointed to the Bitcoin Difficulty Ribbon indicator, which suggests that the price of Bitcoin has long been suppressed. The indicator shows an acceleration in the difficulty of mining, which marked the beginning of the upward cycle in 2013 and 2016.
The biggest variable is the flow of stable coins
Whale stocks on the stock exchanges were high in November, which was the main source of selling pressure.. The only variable that could offset the sales of the whales is the influx of stablecoin. In a recent announcement to its customers, data analytics company CryptoQuant said the number of stablecoins deposited on exchanges has increased significantly in recent months.
So that the Bitcoin price rally continues in the short termThere are two main factors that are critical. BTC must stay above the USD 16,200 support regionwhich he has so far defended with a good reaction from the market.
To would have to see a greater influx of stablecoin in the days to comeThis would indicate that the marginalized capital would return to the market. The note read:
“In recent months, the number of stablecoins deposited on exchanges has increased significantly. This has resulted in selling pressure decreasing and remaining low since the end of September. At the moment, selling pressure is increasing slightly, and it could be.” indicate a correction, but as the Exchange Whale Index remains low it doesn’t seem big. Analysts using CryptoQuants tools, looking at the long-term outlook, expect the price of Bitcoin to hit and beat previous highs of $ 20,000. “.
At least for the foreseeable future It is important that the price of Bitcoin remain stable and consolidate above $ 17,000. This would allow the derivatives market to see a possible recovery in momentum and an open interest in building. So far, there isn’t too much evidence that a massive correction should be made. and that the way to a new record high was hampered in the medium term.
The culmination of negative news, including Coinbase CEO Brian Armstrong’s Twitter thread on US regulation and the Chinese police who seized $ 4.2 billion worth of BTC and other cryptocurrencies from the Ponzi PlusToken program , launched in the past few days to stimulate bearish sentiment.
However, as the impact of this negative news wears off, the fear associated with selling pressures on the price of Bitcoin and other cryptocurrencies could ease in the coming weeks.
Don’t stop reading: