The prevailing market sentiment seems overwhelmingly bearish, yet crypto whales are seizing this moment to accumulate significantly.
Lookonchain, an on-chain analytics firm, recently disclosed on X (formerly Twitter) that a Bitcoin [BTC] whale made a purchase of 545 BTC valued at $30.82 million as the price witnessed a noticeable drop.
Whale Behavior During Price Decline
Furthermore, the same source highlighted that this whale had bought approximately 862 BTC totaling $49 million with an average price of $56,993 over the past three days. This pattern of whales capitalizing on price dips is not uncommon.
An analysis by Santiment, another on-chain analytics firm, revealed that whales and sharks holding between 10 to 10K BTC have accumulated 133.3K BTC from small traders who panicked and sold off their investments over the past month.
The substantial accumulation by whales and sharks during the recent market downturn hints at a potential opportunity for long-term investment.
Bitcoin Technical Analysis and Future Support Levels
Expert technical analysis indicates a bearish outlook for Bitcoin as it broke through a key support level around $57,000 after a strong consolidation.
If the price of BTC closes below $56,500 in a daily candle, there is a strong likelihood that it might decline to levels of $54,000 or $52,000 in the near future.
Currently, BTC is trading under the 200 Exponential Moving Average (EMA) on a daily timeframe, suggesting a downtrend in the asset. However, the oversold Relative Strength Index (RSI) hints at a possible reversal in price.
Significant Liquidation Thresholds
At present, the major liquidation thresholds stand at $55,450 on the downside and $58,450 on the upside as per data from Coinglass, indicating that traders are highly leveraged at these levels.
In case of a persistent bearish sentiment leading to a drop to $55,450, approximately $650 million worth of long positions could be liquidated. Conversely, a shift in sentiment driving the price to $58,450 might result in around $1.32 billion worth of short positions being liquidated.
Data shows that short sellers currently dominate the market and have the potential to trigger more liquidation of long positions, contingent on BTC closing a daily candle below $56,550.
Bullish Signs from On-Chain Metrics
On-chain metrics from CryptoQuant, such as BTC exchange reserve and exchange inflow, present a positive outlook for BTC.
The data reveals that BTC’s exchange reserve is at its lowest level in recent months, indicating accumulation by whales and institutional investors and pointing towards a potential buying opportunity.
Meanwhile, the exchange inflow for BTC has been steadily decreasing in recent months, indicating increased buying interest from investors and institutions.
Presently, BTC is trading around $56,550 with a 4.5% decrease in the last 24 hours. Simultaneously, the open interest has decreased by 4.65%, suggesting a decline in investor and trader engagement.