Bitcoin Whales Step Back as Market Turns Bearish
Bitcoin whales, the large holders of the cryptocurrency, have become passive participants in the current bearish market. This shift may be attributed to the ongoing conflict in the Middle East. The largest crypto experienced a loss of support at $27,000 this week, causing fear among investors who are now concerned about a potential drop to $20,000.
Bitcoin Price Reacts to CPI Data Release
The release of US Consumer Index (CPI) data had an impact on the price of Bitcoin and the overall crypto market. While inflation remained unchanged at 3.7%, slightly higher than expected, the price of goods and services increased at a higher rate than anticipated for September. However, despite the dip in response to the CPI data, Bitcoin managed to hold above support at $26,500. Currently, Bitcoin is priced at $26,859 while Ethereum is at $1,549. The total market value has increased by 0.1% to $1.08 trillion.
Are Whales and Institutional Investors Avoiding Bitcoin?
Insights from blockchain analytics platform CryptoQuant reveal that there has been a significant decrease in BTC deposits, withdrawals, and transactions since May. This decline suggests a decrease in network activity and can be attributed to a lack of new investments entering the crypto market. Whales and institutional investors may also be playing a role in this shift as they interact less with Bitcoin. Without substantial transfers of Bitcoin between these two groups, the chances of a rally in the near future are low.
Despite this decrease in activity, CryptoQuant assures investors that the situation is not dire as both hash rate and mining difficulty are increasing, indicating healthy network fundamentals.
Bitcoin Bulls Aim for Recovery
There are signs that Bitcoin bulls are gaining strength and pushing for a rebound. The formation of a green daily candle indicates increased buyer activity. The immediate support level at $26,500 is holding, and as long as the support at $25,500 remains intact, Bitcoin is in a good position to rebound to $30,000.
The Relative Strength Index (RSI) is showing signs of bouncing back toward the overbought region, which would attract more buyers and potentially help Bitcoin regain ground above $27,000 and $28,000. Resistance is expected at the 200-day Exponential Moving Average (EMA) at $27,015. To fully confirm a bullish breakout targeting $30,000, Bitcoin bulls must push above all three moving averages, including the 21-day EMA and the 100-day EMA.
Hot Take: Bitcoin Whales Step Back Amidst Bearish Market
Bitcoin whales have become passive participants in the current bearish market, possibly due to the ongoing conflict in the Middle East. The recent loss of support at $27,000 has caused fear among investors. The release of CPI data also had an impact on Bitcoin’s price and overall market sentiment. However, despite these challenges, there are signs that Bitcoin bulls are gaining strength and aiming for a recovery. While network activity has decreased, CryptoQuant assures investors that the situation is not dire as network fundamentals remain healthy. It remains to be seen how Bitcoin will navigate these challenges and whether it can reclaim higher price levels in the near future.
Source: [CryptoQuant](https://twitter.com/cryptoquant_com/status/1448523217046958081)
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