bitcoin and the cryptocurrency market continue to break through critical resistance levels and reach new yearly highs. The cryptocurrency is approaching the $50,000 zone as 2023 comes to a close, and two major bullish catalysts are on the horizon.
At the time of writing, bitcoin (btc) is trading at $41,800 with a 6% gain in the last 24 hours. In the previous seven days, btc recorded an impressive 13% rally as analysts and the crypto community celebrated the start of a new bull cycle.
bitcoin Whales Behind $40,000 Rally, More Gains in Store?
Data provided by Ki Young Ju, CEO of crypto analytics firm CryptoQuant, indicates that bitcoin whales have supported the current price action since August. At that time, the cryptocurrency retook the upper $20,000 zone and settled below the critical resistance of $30,000.
As bitcoin trended higher, whales took on potentially “giant positions” in preparation for the current rally. This risky behavior began more quietly when btc touched $16,000.
Young Ju linked the market activity to the increase in purchase orders from American investors. On Coinbase, the price of bitcoin “soared” in October 2023.
Investors in the country have been buying more cryptocurrencies in preparation for the btc Spot Exchange Traded Fund (ETF) approval and halving event. The latest from this event is the reduction of btc mining rewards.
Furthermore, the CryptoQuant CEO believes that retail investors have yet to address the rally. As seen in the chart below, the btc realized limit came in below 0.1, indicating “low liquidity” of retail investors in the crypto market.
<img loading="lazy" decoding="async" class="wp-image-563819 size-large" src="https://www.newsbtc.com/wp-content/uploads/2023/12/bitcoin-price-btc-BTCUSDT-Chart-2.jpg?w=860&resize=860%2C545″ alt=”bitcoin Price btc BTCUSDT Chart 2″ width=”860″ height=”545″ srcset=”https://www.newsbtc.com/wp-content/uploads/2023/12/bitcoin-price-btc-BTCUSDT-Chart-2.jpg?w=1407 1407w, https://www.newsbtc.com/wp-content/uploads/2023/12/bitcoin-price-btc-BTCUSDT-Chart-2.jpg?w=460 460w, https://www.newsbtc.com/wp-content/uploads/2023/12/bitcoin-price-btc-BTCUSDT-Chart-2.jpg?w=768 768w, https://www.newsbtc.com/wp-content/uploads/2023/12/bitcoin-price-btc-BTCUSDT-Chart-2.jpg?w=860&resize=860%2C545 860w, https://www.newsbtc.com/wp-content/uploads/2023/12/bitcoin-price-btc-BTCUSDT-Chart-2.jpg?w=750 750w, https://www.newsbtc.com/wp-content/uploads/2023/12/bitcoin-price-btc-BTCUSDT-Chart-2.jpg?w=1140 1140w” sizes=”(max-width: 860px) 100vw, 860px” data-recalc-dims=”1″/>btc's realized cap below 0.1 hints at the low participation of retail investors in the current AP. Source: CryptoQuant on X
Additional data provided by Material Indicators confirmed the increasing buying pressure from whales. Analyst Keith Alan stated that this behavior occurs to attract liquidity to the market.
Once liquidity, primarily from retail investors, enters the market, whales can “distribute” their coins or “dump” them into retail trading to profit from their position. Through his identifier fixed the following regarding btc's potential to continue the uptrend:
(…) since we now have ~$86 million in near-range #btc supply liquidity, I'm considering buying this pullback because it doesn't look like the game is over yet.
