As a seasoned analyst with over two decades of experience in financial markets under my belt, I’ve seen my fair share of market anomalies and trends that defy conventional wisdom. However, the recent behavior of Bitcoin has left me scratching my head more than usual. Despite the historically bullish period in October, we’re witnessing a different story unfold this year.
According to historical price action data, October’s final two weeks have traditionally been the most bullish for Bitcoin prices. Yet, this trend hasn’t played out recently, leaving many investors puzzled. Despite the favorable past momentum, Bitcoin’s price has actually dropped to around $65,000 during the last week. Curiously, recent on-chain insights imply that this slow market could persist for the leading cryptocurrency still.
Is The Rising Exchange Whale Ratio Bullish Or Bearish?
Lately, an analyst on the CryptoQuant platform highlighted that the “Exchange Whale Ratio” related to Bitcoin has significantly increased in recent weeks. This “Exchange Whale Ratio” statistic calculates the proportion between the combined sum of the largest ten deposits into centralized exchanges and the total amount entering these platforms.
It’s presumed that the 10 biggest transactions into exchanges are made by ‘market heavyweights,’ who are entities with considerable power due to their vast cryptocurrency holdings. The Exchange Whale Ratio measures the level of trading activity by these prominent investors relative to the rest of the market.
A large Exchange Whale Ratio means that the largest 10 inflows to exchanges significantly outweigh the transfers coming from the rest of the market. Conversely, when this metric is small, it implies that whales comprise a relatively modest portion of funds entering centralized exchanges.
Based on figures from CryptoQuant, the average over the past week for Bitcoin’s Exchange Whale Ratio has just hit its peak level since last November (2022).
The Quicktake analyst noted that an increase in this particular indicator might signal a negative trend for the primary cryptocurrency’s value, since it may suggest that large investors (whales) could be exerting considerable selling force on the market. Furthermore, when whales transfer their funds to trading platforms, it can trigger a chain reaction of selling, as other investors frequently follow their lead due to the impact they have on the market.
Bitcoin Price At A Glance
Currently, Bitcoin’s value hovers near $66,700, a decrease of nearly 2% in just the last 24 hours. This one-day dip highlights Bitcoin’s relatively slow pace in recent days. As per CoinGecko’s statistics, its price has fallen by more than 3% over the past week.
Featured image created by Dall.E, chart from TradingView
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2024-10-26 19:16