Key Points
- Bitcoin’s next significant demand zone is around $56,000, following a 4% drop in its value.
- Demand for Bitcoin has slowed, both from new ETFs and existing holders.
Bitcoin [BTC] has experienced a sell-off, with a decrease of over 4% in the last 24 hours, bringing its trading value to the $62,000 zone. Trading volumes have increased by almost 5% to $45 billion during this period, indicating high market speculation.
According to IntoTheBlock, an on-chain analytics firm, the recent dip came from a significant demand zone. Historical data revealed that over a million wallets had bought BTC at an average price of $64,300, acting as a robust support. However, with this support breached by bears, the next significant demand zone lies around $56,000. This suggests that if accumulation doesn’t pick up, BTC could risk dropping to the aforementioned level.
Whale Activity and Market Accumulation
Some savvy investors are using the market downturn to increase their Bitcoin holdings. Lookonchain, an on-chain tracker, reported a whale purchasing up to 244 Bitcoins, equivalent to $15 million at the time, in the last two days. This wealthy player has acquired approximately 915 Bitcoins since December 2023.
However, a broader market accumulation trend seems to be lacking. According to AMBCrypto’s analysis of Santiment’s data, there is no rush among whale cohorts to stockpile Bitcoins. Wallets holding between 1,000 – 10,000 coins have shown minimal increase, while those storing 10,000 – 100,000 coins have liquidated their holdings over the past week.
Julio Moreno, Head of Research at CryptoQuant, supports these findings. His data-backed research shows a slowdown in Bitcoin’s demand, both from new exchange-traded funds (ETFs) and existing holders.
Speculative Trading and Future Outlook
Despite these alarming developments, speculative traders remain optimistic. AMBCrypto’s analysis of Coinglass’ data shows a Longs/Shorts Ratio of more than 1, suggesting that the majority of futures traders expect a rebound. However, there are concerns of further downsides in Bitcoin’s price in the upcoming days.
