Key Points
- Bitcoin (BTC) recovers to $96k after a dip to $89k, with whale activity affecting the momentum.
- Key metrics like open interest and whale transactions indicate mixed signals for Bitcoin’s near-term outlook.
Bitcoin (BTC) began the year on a high note, reaching $102,000 on 07 January. However, this initial surge was short-lived, with the cryptocurrency experiencing significant corrections and falling below $100k soon after.
At present, Bitcoin is priced at $96,556, following a partial recovery from a dip to $89,000 earlier in the week. This price drop below $90,000 has raised concerns among market participants, with analysts investigating the underlying factors influencing this movement.
Whale Activity and Market Sentiment
An analysis by CryptoQuant attributes the limited recovery of Bitcoin to whale inactivity. The Coinbase Premium Gap (CPG) data indicates significant selling activity by whale entities, but no corresponding buying action to counterbalance the drop.
Typically, when whales buy Bitcoin during a decline, the market experiences increased volatility. However, this was not the case during its latest price movement. The analysis emphasizes the importance of activity on major exchanges, particularly Binance, where whale participation often impacts market-buy ratios.
In this case, there was no evidence of substantial buying by Binance whales, suggesting a cautious approach by large-scale investors. While the daily candle pattern indicated potential for a trend reversal, the lack of engagement from major players raises uncertainty about Bitcoin’s near-term trajectory.
Bitcoin’s Metrics Flash Mixed Signals
In addition to whale activity, other Bitcoin metrics provide further insights into the asset’s performance. For instance, open interest, a measure of the total number of outstanding derivative contracts, rose by 2.09% over the last 24 hours to $61.88 billion.
This increase in Open Interest suggests a renewed interest in trading activity and could indicate more speculation about Bitcoin’s future price movements. Additionally, the Open Interest volume surged by 213.18% over the same period – A sign of heightened market engagement.
Data from IntoTheBlock shows fluctuations in whale transactions, defined as transfers exceeding $100,000. Over the past month, the number of these transactions fell from 26,000 on 16 December to 15,000 by 12 January. However, there has been a notable rebound, with over 20,000 transactions recorded on 13 January. This resurgence in whale activity could indicate renewed interest in Bitcoin among large investors, potentially influencing market momentum in the coming weeks.
