Bitcoin [BTC] showed a strong rebound of more than 3% in the recent trading session on September 2nd. Reports circulating around the accumulation of BTC by large holders, known as whales, contributed to the excitement seen in the market.
Nevertheless, the subsequent lack of sustained momentum raised doubts about the validity of these reports.
Recent data from Lookonchain indicates that whales have been transferring Bitcoin to exchanges despite continuous outflows. This behavior hints at a potential move by whales to create more volatility in the market.
On the other hand, CryptoCrypto noted negative net outflows from Bitcoin ETFs, which did not instill much confidence among investors.
Given these developments, a closer examination of Bitcoin addresses was necessary to assess the state of accumulation.
Data from IntoTheBlock revealed a decline in the number of addresses holding BTC in various ranges. For instance, addresses with holdings between $100,000 and $1 million reduced from 516,000 addresses on August 25th to 486,500 addresses on September 2nd.
Similarly, addresses holding $1 million to $10 million worth of BTC decreased from 100,540 to 96,150 addresses within the same period.
Meanwhile, addresses with holdings exceeding $10 million worth of Bitcoin dropped from 100,440 to 100,000 addresses.
Is Bitcoin Witnessing a Strategic Price Setup?
The data provided insights into the significant selling pressure exerted by whales. It suggests that the market hype might have been a calculated move to prompt activity and create liquidity for sellers to exit positions.
This dynamic could explain Bitcoin’s struggle to surpass $60,000 and maintain a sustained upward trajectory.
In times of potential inducement, there is typically a surge in leveraged positions. Notably, we observed a substantial accumulation of 25.582 million net long positions at a pivotal moment on August 2nd.
This figure surged to 52.82 million net longs around the $58,000 price level, reflecting heightened expectations for further gains and an increased appetite for leverage in the market.
The data also showed a bottoming out of Bitcoin’s estimated leverage ratio on August 12th, followed by a shift indicating a growing acceptance of leverage among participants, possibly leading to significant liquidations in the event of a downturn.
As of the latest data, Bitcoin was trading at $58,861, showing a slight decline of 0.47% over the past 24 hours.
These developments underscore the ongoing struggle to sustain positive momentum, particularly in the face of selling pressure from whales. The scenario also raises concerns about potential liquidation events if the price experiences further downward movements.
Looking ahead, the next 24 hours will be crucial for Bitcoin, with market participants eagerly awaiting the Federal Reserve’s decision on interest rates. This decision could potentially fuel increased volatility in the latter half of the week.