Long Bitcoin positions appear to be increasing as investors re-enter the market, while whales add tokens to their holdings. Although the recent surge in buying pressure appears to be encouraging, BTC still faces one major challenge.
Bitcoin Purchase Orders Are Being Fulfilled
Whales have refocused their attention on Bitcoin.
The September 7 flash crash has frightened market participants. Now, some of the crypto industry’s most renowned technical analysts believe that Bitcoin’s rejection from $53,000 could result in a disastrous outlook.
For example, the analyst known as dave the wave believes that the flagship cryptocurrency will fall to around $30,000. They stated that the recent downward pressure could accelerate into a more significant downtrend because the moving average convergence divergence, or MACD, on BTC’s monthly chart had a bearish cross.
Despite the bearish worst-case scenario, several fundamental factors point to some investors taking advantage of the price drop to purchase Bitcoin at a discount.
For the first time since July 22, the number of long Bitcoin positions on Hong Kong-based cryptocurrency exchange Bitfinex has reached a new high. Over the last week alone, over 3,200 long positions have been opened, indicating that some traders have bought the dip.
Similarly, Santiment, a behavior analytics platform, shows that whales are accumulating.
Addresses with 10,000 to 100,000 BTC purchased over 60,000 BTC worth approximately $2.82 billion during the same time period. This large number of tokens were also removed from well-known cryptocurrency exchange wallets, reducing selling pressure on Bitcoin.
While buy orders continue to pile up, IntoTheBlock’s In/Out of the Money Around Price (IOMAP) model indicates a significant supply barrier ahead of Bitcoin. Previously, nearly two million addresses purchased nearly 900,000 BTC between $46,900 and $49,650.
Only a daily candlestick close above this resistance wall would indicate that the uptrend has resumed.
To avoid further losses, Bitcoin must remain above the $44,000 to $46,800 support zone. Slicing through this significant interest area may entice investors to sell their BTC in order to avoid their investments going “Out of the Money.” In this scenario, a drop to $38,000 is possible.