26 Sep 2020 #Bitcoin
Bitcoin whale clusters show the $10,407 level has turned into a strong support area, raising the chance of a renewed bullish uptrend. Bitcoin (BTC) whale clusters indicate that the price could be in a short-term trend reversal after BTC’s recovery beyond $10,700. In the past two days, BTC price rose by nearly 6% from $10,135 to $10,755 across major exchanges.
Whale clusters form when large investors accumulate Bitcoin and do not spend or move their holdings for significant periods of time. This typically indicates that whales expect BTC price to increase in the near term.
Whalemap, an on-chain analysis firm that tracks whale activity, identified $10,407, $10,570, and $10,667 as whale clusters. In the short term, the three levels are likely to serve as potential support areas if BTC remains above $10,700.
According to the analysts at Whalemap, Bitcoin can remain in a bullish trend as long as it defends $10,407. The analysts emphasized that the trend suggests “bulls have won,” as the market sentiment improves from the recent upsurge. They explained:
“Feels like bulls have won. Many supports below at $10,407 and $10,570 and volume profile support at $10,500. Should not be going below $10,407 to stay bullish.”
An interesting irregularity in the recent Bitcoin rally is that it has decoupled from gold, as Cointelegraph reported. While gold dropped slightly by 0.32% in the last 24 hours, BTC rallied above $10,700.
Willy Woo, an on-chain analyst, said decoupling indicates that the momentum of Bitcoin is strengthening. He said:
“Bitcoin will decouple from traditional markets soon, but driven by its internal adoption s-curve (think startup style growth) rather than changes in perceptions as a hedging instrument by traditional investors.”
Atop the various technical factors buoying the uptrend of Bitcoin, the current fundamentals project a positive near-term outlook.
Earlier this week, data from Glassnode showed that the number of small Bitcoin addresses abruptly plunged in September. Despite this, the analysts at Glassnode noted that the data is not concerning and does not impact network fundamentals. They explained:
“The recent drop in #Bitcoin addresses holding ≥ 1 $BTC is of no concern and has no relevance regarding network fundamentals. This was merely an exchange doing inhouse cleaning, and merging a bulk of small UTXOs in separate addresses into a single one.”
Cryptocurrency trader Edward Morra believes that the market has to move above $10,830 to confirm a bullish continuation. If BTC rejects $10,830 and returns back below $10,500, the $9,800 to $10,830 range could cause BTC to stagnate over a prolonged period. Morra said:
“Below daily resistance, above daily support = Ranging market. Price currently at a bearish throwback at $10,830. If we move above, expect a re-test of daily resistance at $11,200. Not interested in trading chop range - Wait for expansion. Support = $9,800 - $10,100.”
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