Bitcoin Bullish Momentum Fades as Deposits Rise at Lower Prices
Looking at the current state of being on Bitcoin in Week 30 of 2023
Large Funds Moving to Exchanges
Bitcoin has failed to gain strength and maintain momentum above US$30,000 last month as it showed promising signs of a continuation of the upward trend. Recent on-chain data suggests that a total of US$275 million worth of exchange deposits have been transacted in a single day.
While split over multiple transactions, actions of such largely sized transactions done by large holders, often significantly impact the overall market. There are multiple ways for large funds to be transferred, but when those are done through exchanges, it generally signals that these large holders are preparing to sell in large volumes. Many traders consider this a bearish signal, which sparks worry that the price may drop further.
Long-Term Holdings Reach 1-Month Low
In addition, a Glassnode-provided indicator known as the BTC HODLER Net Position Change has fallen to a 1-month low. This shows that during the past few weeks, more holders have closed out existing BTC positions in order to extract their profits than have started new ones.
It is important to keep an eye on in and outflows of cash in the cryptocurrency market. While this can help spot a change in sentiment, it might also help reveal where the price of Bitcoin is headed in the short term.
Disclaimer: The opinions expressed in this article are for informational purposes only. This article does not constitute an endorsement of any of the products and services discussed or investment, financial, or trading advice. Qualified professionals should be consulted prior to making financial decisions.
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