If it looked like Bitcoin would’ve have a hard time portraying a V-shaped recovery to the not long ago highs we’d seen, on-chain movement indicated an increasing selling demand in the market, primarily by Bitcoin whales. This may have been why the recovery was impacted.
An aggregated 95.64K BTC was deposited into exchanges on 26th Nov the day BTC price dumped.
CryptoQuant, the blockchain analytics firm, said that according to its exchange inflow indicator, the 144-block (roughly a day) an average of mean bitcoin funds across significant cryptocurrency exchanges, has increased to 2.5 bitcoin, the top-most level since March 20.
To put it differently, a new high has been observed in eight months in the average size of inward-bound transactions to trading platforms.
“The data shows whales [large traders] are transferring their coins to exchanges,” CryptoQuant CEO Ki-Young Ju told CoinDesk. “The cryptocurrency usually trades in a sideways-to-negative manner when whales become active on exchanges.”
The probability of prices dropping or falling to new local lows can’t be dismissed, with average inflows currently moving beyond 2 Bitcoin i.e. CryptoQuant’s “danger zone.”
A depiction above 2.00 on the indicator has constantly facilitated a significant fall in price in 2020. The indicator has risen beyond that level at least a week prior to the 40% fall witnessed on March 12.
Likewise, the sharp rise in the metric was followed by a steep sell-off witnessed in November 2018.
Technical chart researches show lesser odds of an instant jump to levels beyond $19,000.
Since June 1, Thursday’s price fall was supported by the highest sell volume (red bar). For this reason, the pullback looks to have some support. Short duration momentum indicators like the 5 and 10-day moving averages are presently turning south. From September low to November high support is witnessed at $15,798 – the 38.2% Fibonacci retracement of the rally.