- Despite bearish signals, Bitcoin has returned to a price of $18,000
- Some whales moved millions onto exchanges, and took profit, but the price returned
- This suggests that the price of BTC has more strength to hold at these levels than it did in 2017
Though whales moved millions of BTC on exchanges in the last few days, the price of BTC has recovered, heading towards ATHs once again.
While Bitcoin never made it back to its all time high of $20,000, it has been pumping over the last week. Many people feel that this time, it’s different.
Earlier this week, the price of BTC dropped from nearly $20,000 near to a resistance of $16,300. Things did not look good as the crypto market has grown tremendously since August. At the end of July, 2020, the total crypto market cap was around $311 million, and now sits at $546 million, according to Coingecko.
Right before and after the Nov 25/26, 2020 dip, there were a number of bearish signals for BTC.
Besides the psychological resistance level of $20,000, things had changed since 2017’s bullrun to question this rise. Now, investors are long term adopters, rather than just speculators, according to a report by Grayscale.
Many seem in the mindset that the dips are only temporary, especially considering the major wall street players who now own Bitcoin. Even the humanitarian Guggenheim foundation has filed documents suggesting it may put up to 10% of its wealth in Bitcoin.
Plus, of course, there is the pandemic. The fear of economic collapse and printing of money to support the world (and the US) economy has made Bitcoin, with its predictable inflation, more appealing to investors.
Though those big players were giving Bitcoin legs to stand on, it also meant there were many with profits in mind. By Nov 27, it seemed whales were taking profits. A very short $15 billion drop suggested as much.
A tweet from “intheblock”, an analytics company, suggested that whales were moving billions of dollars from storage wallets onto exchanges.
Likewise, a Nov 26, 2020 tweet from Whale Alert noted that Microstrategy, a wall street company that instigated a move on Wall Street toward Bitcoin, moved $658 million of BTC onto an exchange.
Both of these moves seemed bearish, suggesting that whales were getting ready to sell.
In addition to simple price action, some are wary of the future of crypto in the United States. Brain Armstrong, CEO of Coinbase, took to Twitter to respond to rumors that US Treasury Secretary Steve Mnuchin was going to rush-through regulations for crypto wallets before the end of President Trump’s term.
These signals may have caused the pullback to around $16,300, but it did not take long for Bitcoin to return full steam. At press time, the price is around $18,100, and would be a bullish way to start the week. Up until now, Bitcoin had only ever stayed about $18 K for a few days. Despite the pullback, the price is still looking strong.
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