Is The $BTC Bear Market Imminent? Whales Are Confident in $BTC’s Rebound as Retail Investors Panic

• Technical indicators, including moving averages, profit and loss index, and momentum, suggest a potential bear market for Bitcoin ($BTC).
• While retail investors feel selling pressure, large investors are accumulating $BTC in hopes of a soon rebound.
• Despite its recent struggles, $BTC has outperformed gold and major stock indices in 2024.

$BTC stands in a precarious position, potentially heading for a bear market as it struggles to break above $60K. Meanwhile, whales are hoarding the token as smaller traders liquidate their holdings to offset losses.

Can $BTC withstand headwindsand hedge investors against a broader market downturn? Let's unpack this.

The End of $BTC Bull Run?

$BTC is now trading at $57.9K, down 0.67% in 24 hours and 8.63% last week. After dropping to $49.8K on August 5, $BTC had been hovering below $60K for weeks, failing to break the $64K resistance line.

CryptoQuant data suggests a major price correction or a bear market is imminentas $BTC's profit and loss index is fluctuating near the 365-day moving average.

Charts reveal that the $BTC price dropped significantly after the profit and loss index crossed below its 365-day moving average in May and November 2021. On each occasion, $BTC lost approximately 40% of its value.

$BTC's negative momentum value indicates a strong downward pressure, strengthened by the substantial decrease in the Moving Average Convergence Divergence (MACD) value. Besides, $USDT's market cap decline could potentially impede or delay $BTC price growth.

On the other hand, the neutral Relative Strength Index (RSI) signals that $BTC's price could go in either direction as it's neither overbought nor oversold.

$BTC's Tug-of-War: Fear vs Greed

Worrying technical indicators put significant selling pressure on $BTC investors. The Fear & Greed Index, capturing broader market sentiment, currently sits at 26, bordering Extreme Fear.

In contrast, large investors see the drop in price of $BTC as a buying opportunity. The number of wallets holding over 100 $BTC, worth at least $5.9M, reached 16,120, hitting a 17-month high.

Sharks,' wallets holding at least 10 $BTC, have also been active lately. Santinent reports that sharks and whales have collectively accumulated over 133 $BTC in August, worth $7.6B.

Adam Back at Blockstream also points out $BTC whales' buying spree.

Whales back buying 450btc/day every minute all day long, since dip on 28th. Same as Bitcoin mined per day. Go ahead sell them cheap corn.Adam Back

Increased whale activity has historically been a positive sign for $BTC. In 2020, it helped $BTC hit a new all-time high (ATH) of $27K.

$BTC Outperforms GoldDespite the 20% drop from its ATH of $73.7K, $BTC still outperforms gold, which appreciated 23% this year.

Central banks worldwide have been investing in gold at record levelsthroughout 2024. Kobeissi Letter notes global net gold purchases hit 483 tonnes in Q2 2024, a 5% increase from the previous record of 460 tonnes in Q2 2023. In Q3 2024, central banks bought another 183 tonnes of gold.

While this buying pressure drives gold value, $BTC tops the valuable commodity with a 37% year-to-date increase. Major stock indices like S&P also fall behind with an 18% yearly appreciation.

US Elections As a Catalyst for $BTC Growth

As analysts speculate on $BTC's ability to withstand the bear pressure, the upcoming US elections could catalyze its rebound to former ATH.

$BTC has historically experienced significant growth post-election, reaching its peak approximately a year later. To illustrate, in November 2016, $BTC stood at $703; in December 2017, it was trading at $20K.

Just over two months remain until the US citizens will nominate their next President. Some crypto enthusiasts believe Trump's victory would be a better outcome for the industry given Harris' uncertain stance on regulation, yet Polymarket shows the candidates' odds are even.

Closing Remarks

Technical indicators paint a bleak picture for $BTC, yet whales are accumulating Bitcoin at a record rate, viewing the current dip as a buying opportunity.

Are whales right in anticipating $BTC's rebound, and will the US election fuel $BTC price action? We'll have to wait and see.

References

Click to expand and view sources

• Bitcoin (CoinMarketCap)
• Bitcoin (TradingView)
• Santiment (X)
• Fear & Greed Index (Binance)
• Adam Back (X)
• Bitcoin (CryptoQuant)
• Kobeissi Letter (X)

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