Bitcoin

Bitcoin price rises to $ 17,700, but not everyone agrees that the rally is sustainable

Bitcoin (BTC) price broke above $ 17,400 on a strong intraday rally. On Coinbase, BTC even approached the USD 17,700 mark and set a new two-year high. As BTC slips through multi-year resistance above $ 17,000, analysts disagree on the near-term outlook. Some say BTC is on the verge of retreating as the whale’s forex deposits begin to rise. Others believe there is little resistance up to $ 20,000 and that an all-time high is likely to be hit before the next deep correction.

Bitcoin’s momentum over the past month has been particularly impressive for two main reasons. First of all, during previous bull cycles, such as explained The renowned dealer Peter Brandt, BTC, made up to nine corrections. In the ongoing rally, however, BTC has only seen two corrections of 10%. Second, Bitcoin has consistently rallied from areas where corrections were expected, such as November 16 when it hit $ 14,774 on Binance.

But still, Suggestions for corrections or downgrades are also increasing as market sentiment around Bitcoin intensifies. Speaking to Cointelegraph, Ki Young Ju, CEO of data provider CryptoQuant, said the proportion of whales on the exchanges suggests that whale stocks on the exchanges are increasing. Short term, This could increase the selling pressure on BTC. Traders also say the current highs for BTC, near $ 20,000, could be brought forward, which would result in a correction before the level is reached.

A little bitcoin pullback?

Bitcoin price rises to $ 17,700, but not everyone agrees that the rally is sustainable
Bitcoin price rises to $ 17,700, but not everyone agrees that the rally is sustainable

When bitcoin whales deposit BTC on exchanges, the trend typically shows an intention to sell by wealthy investors. Based on CryptoQuant’s token transfer metric and the percentage of whales in the exchanges, deposits from both whales and investors in general are starting to increase. This means that more and more investors are going to stock exchanges to profit from their BTC holdings. Ki said:

“The transfer of tokens (that do not match an entity) on the Bitcoin network is increasing, indicating that whale wallets are moving their funds. And the rate of money flow for all exchanges is decreasing, which means that the exchanges are these big ones Have not evoked transactions. […] I think massive OTC trading is still going on. This is one of the main reasons I stick with Bitcoin for the long term. “

The whale ratio of the exchanges is also at a level that has historically led to a huge drop in prices. Ki said the rate has been hovering above 85% for the past few days, placing Bitcoin in a risky position for a possible correction. With virtually no resistance between $ 18,000 and $ 20,000, the whales are expected to make a profit of around $ 17,000.

Whales seek liquidity for both buy and sell orders as they handle larger volumes. Selling when the BTC price rises is ideal for whales as it limits potential downward volatility. Therefore, there is a high chance that the whales will want to sell between $ 17,000 and $ 18,000 as the last stop before hitting a new all-time high. As Ki added:

“Looking at the ‘Exchange Whale Ratio (72h MA)’ the BTC price will likely be revised slightly. If it is below 85% the chances that the price will continue to rise are high. Between 85% and 90% indicate this hin A correction of over 90% indicates that a sharp fall in prices could occur. We have a certain risk of correction as this value has lately been over 85%. “

Some pseudonymous traders have also predicted that BTC will see a short-term cap before hitting a new high. In the medium term, even if the momentum of BTC is strong, a trader called “SalsaTekila” said This further evidence of lower BTC support is expected. He pointed out $ 12,000 as a potential area that the next deep correction could lead to. Also, taking into account Bitcoin’s historical cycles, the trader said a six-month correction wouldn’t be uncommon.

A continuous rally until the end of the year

Due to the favorable technical structure of Bitcoin, the remarkable increase in daily volume in the cryptocurrency market reinforces the upward trend. On November 17th, Binance CEO Changpeng Zhao, said that the exchange had a very high system load, which indicates that the demand for cryptocurrency trading is increasing.

Arcane Research also found that Bitcoin’s spot volume increased 270% over the past month. The significant increase in the volume of the cryptocurrency market overall shows that the real demand is behind the current bull run. The weekly report from Arcane Research reads:

“The daily volume on Thursday last week was the highest since the brutal March crash, and the volume has remained high for the past few days. This has taken the 7-day average to new highs this week. Bitcoin volume is up over 270% in the last month. “

Despite all of the positive factors mentioned, the mainstream market is not part of the ongoing rally. Google Trends shows that the popularity of the keyword “Bitcoin” is only 16% of the popularity of the 2017 peak. A recent report from Bloomberg called the recent uptrend an “nobody talks” rally. These trends show that Bitcoin can grow significantly by the end of the year.

But Matt Maley, an investor at Miller Tabak + Co. who recognizes the high institutional demand surrounding Bitcoin, said so It remains uncertain whether individual investors will return, as those who “burned a lot” in 2017 are now likely to be “less enthusiastic” about BTC. That would change if Bitcoin breaks its record high of $ 20,000 and the FOMO (fear of getting lost or being left out) returns around BTC. Hence, there is a high likelihood that a broader rally could emerge if BTC hits a new all-time high.

Similar Posts