The movement and accumulation of crypto whales are two of the catalysts for bitcoin price increase. Although the main whales are I still buy the dipOn-chain data indicates an overall decline in accumulation momentum, suggesting that its conviction might actually be declining.
According to IntoTheBlock, an on-chain analytics company, bitcoin whale accumulation volumes have decreased substantially in each buying cycle over the past month. This decline in whale accumulation could be worrying for investorsespecially as bitcoin price is now trying to stay above $60,000.
Whales' appetite for bitcoin dips based on on-chain data
Whales, or large investors who own more than 1,000 btc, have been accumulating strongly since the beginning of the year, especially during market declines. This accumulation has greatly helped maintain bitcoin's bullish sentiment and prevented major price drops. However, IntoTheBlock recently revealed an interesting pattern between these whale portfolios at each accumulation phase.
The largest accumulation occurred between March 5 and 7, when these wallets acquired more than 120,000 btc. However, each subsequent price drop has seen less accumulation than the previous one. Notably, bitcoin's recent drop to $56,000 failed to attract notable whale accumulation. This drop in buying and selling activity indicates that the whales may have lost some interest or appetite for accumulating more bitcoin in the short term.
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Whales are buying the dip, but is their conviction waning?
Addresses with more than 1000 btc have accumulated strongly in recent months, especially during dips.
Prices have increased shortly after each accumulation.
However, keep in mind that each increase in accrual by… pic.twitter.com/OkbekJr5NC
– IntoTheBlock (@intotheblock) twitter.com/intotheblock/status/1787451114855518282?ref_src=twsrc%5Etfw” rel=”nofollow”>May 6, 2024
Precursor of a fall to $50,000?
The waning conviction among bitcoin whales has raised the question of whether bitcoin could once again become a full bearish momentum. These concerns are particularly valid, considering that some analysts believe that bitcoin could have peaked in this cycle.
As IntoTheBlock noted, prices rose shortly after each build this year. While reduced whale buying activity could curb price increases in the short term, it is not a sure sign that bitcoin is headed for a major price drop. However, if the trend continues for several more months, it could indicate lower demand and a weakened bull market.
According to the “Money In/Out Metric”, there is still strong volume resistance between $59,000 and $61,000. A drop below this range would again lead to losses at 552,220 addresses. In fact, while a drop to its level would be painful for many holders, most crypto analysts remain bullish on bitcoin long-term perspectives.
At the time of writing, bitcoin is trading at $61,488. The cryptocurrency recently recovered around $57,500 and is up 7.4% in the last seven days. According to analyst Marco Johanning, $57,000 x.com/themarcojo/status/1785963379921940604″ rel=”nofollow”>It is an important support level for bitcoin. He noted that while a break below $57,000 could lead to further declines to $52,000, the cryptocurrency market remains very bullish for bitcoin.
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btc price struggles to hold $61,000 support | Source: BTCUSD on Tradingview.com
Featured image of FameEX, chart from Tradingview.com
Disclaimer: The article is provided for educational purposes only. It does not represent NewsBTC's views on whether to buy, sell or hold investments, and investing naturally carries risks. It is recommended that you conduct your own research before making any investment decisions. Use the information provided on this website at your own risk.
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