Analyzing Bitcoin’s Ongoing Accumulation Patterns
Despite facing challenges in maintaining a bullish trend recently, Bitcoin has shown signs of a potential short-term rally. As we approach the mid-October mark, expectations for a positive trend known as Uptober have not entirely materialized.
The dip in Bitcoin’s price to below $60,000 has raised concerns regarding the bullish prospects for October. However, an analysis by CryptoQuant hints at the possibility of a strong short-term bullish movement that may already be in progress.
According to CryptoQuant’s assessment, Bitcoin is currently experiencing an accumulation phase, as indicated by the Coinbase Premium Gap metric. The analysis highlights a consistent surge in accumulation whenever the BTC Coinbase premium falls below -50.
While the Bitcoin Coinbase premium gap recently dropped well below -100, prompting speculation about heightened accumulation activities, the implications remain unclear.
Bitcoin’s Rising Demand Supersedes Selling Pressure
The recent price action of Bitcoin seems to support the aforementioned analysis.
At the time of writing, the cryptocurrency was valued at $63,667, displaying a recovery of over 6% from its weekly low on Thursday. This swift bounce suggests robust demand in and around the $60,000 price level.
Notably, the resurgence of bullish momentum was observed following a retracement to the 0.5 and 0.618 Fibonacci levels based on the price range in September, indicating a potential resurgence of accumulation and demand from this zone.
The gap between incoming and outgoing exchanges widened after the drop below $60,000, with a notable increase in Bitcoin outflows compared to inflows in the last 24 hours, hinting at stronger buying pressure.
Furthermore, on-chain data revealed heightened whale activity during the week, with substantial inflows exceeding outflows. Despite a slight slowdown in large holder flows, the net increase in whale liquidity suggests a positive outlook.
These collective insights point towards a potential upward movement for Bitcoin. Nonetheless, the sustainability of the current momentum in the long run remains uncertain. Nevertheless, the recent bounceback affirms that prices below $60,000 could still be deemed attractive for investors seeking a discount.