Bitcoin has shown unreal resilience by absorbing the impact of massive sales from early holders and still maintaining its trend above $100,000.
The pioneering cryptocurrency is down 2.6% today, relinquishing all of its gains over the weekend. BTC surged from $108,350 on Friday to $111,200 on Sunday but has now failed to break above $108,000 at the time of writing.
Notably, the sideways price action saw it close October in the red for the first time since 2018. Bitcoin recorded a 3.87% decline last month, marking the end of a six-year uptrend streak.
Profit-Taking-Fueled Correction
Meanwhile, Singapore-based crypto trading platform QCP Capital attributed this price correction to profit-taking among long-standing whales. It noted that long-term BTC holders dumped 405,000 BTC over the past month, bringing heavy selling pressure to the asset’s price.
Even today, QCP noted that these whales are still selling, citing a sizeable Bitcoin move to crypto exchange Kraken. This continues the trend seen in October, casting doubt on the trajectory of the premier asset despite no clear macroeconomic headwind.
Notably, this disposition impacted not only Bitcoin but also the broader cryptocurrency market. For perspective, as whales liquidated BTC, long-term XRP holders were also selling at an average of 260 million XRP per day.
Current State of the Market
Remarkably, QCP highlighted Bitcoin’s resilience in maintaining crucial support levels. Despite the over $43 billion dump from legacy holders, Bitcoin still holds above the psychological $100,000 price mark.
Currently, the crypto market remains flat. Analysts at the crypto trading platform suggested that this could continue until whale sales subside. Volatility ticked up slightly over the past week, with traders more invested in put positions. However, the market skew indicates caution among bears regarding further downside for Bitcoin.
Furthermore, leverage sizes suggest caution, as futures open interest has subsided since the October 10 crash. Funding rates are also flat, as investors stay on the sidelines to observe the next market movement.
Corporate firms are also acquiring Bitcoin at a slower rate. For context, Strategy purchased just 778 BTC in October, representing a decrease of approximately 78% from its purchases in September.
Outflows from Bitcoin ETFs further add to the cautious mode. The investment vehicles recorded an outflow of $799 million last week, with BlackRock alone selling $403 million in BTC.
Just Another Correction or Something Deeper for Bitcoin?
Meanwhile, the cautious tone and incessant whale dumps raise questions over the price trajectory of Bitcoin in the near term. Will Bitcoin continue to decline, potentially leading to a crypto winter, or will it rebound to higher prices?
Well, QCP highlighted that the subsequent price development remains unclear. The mixed feelings about whale sales and institutional inflows, despite the latter being currently meager, are the major reason for this uncertainty.
This is why many suggest this cycle is different. Such whale activity would have marked the end of the bull cycle, undoubtedly. But institutional adoption continues to strengthen the market’s foundation.
Interestingly, prominent crypto figures remain optimistic that Bitcoin will target new highs in the near term. Michael Saylor believes Bitcoin would “grind up” to $150,000 by year-end, with BitMine’s Tom Lee predicting $250,000.
DisClamier: This content is informational and should not be considered financial advice. The views expressed in this article may include the author's personal opinions and do not reflect The Crypto Basic opinion. Readers are encouraged to do thorough research before making any investment decisions. The Crypto Basic is not responsible for any financial losses.
