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Bitcoin Price Starts the Week with a Strong Recovery
On March 25, the price of Bitcoin (BTC) opened above the $67,500 mark, showing an 8% increase over the weekend. This recovery comes after a sell-off of $840 million from Bitcoin ETFs last week, which caused bearish pressure on the price. However, on-chain data suggests that BTC may experience more volatility in the upcoming week.
The surge in Bitcoin price can be attributed to significant purchases made by whale investors in the US during the weekend. These investors took advantage of the price dip caused by the ETF sell-off and bought more BTC, leading to an 8.3% increase in price.
The Coinbase Premium Index, which compares BTC prices on Coinbase Pro and Binance exchanges, also indicates increased buying activity among US-based whale investors. The positive values of the index reflect higher prices on Coinbase due to the peak buying activity of these investors.
Although the recent increase in BTC price is encouraging, other market metrics suggest that volatility may continue in the coming week. One such metric is the movement of long-term investors who are preparing for the upcoming Bitcoin halving event on April 20. Long-term investors have recently started selling their BTC holdings, as indicated by the movement of coins that had been held dormant for over a year. This could potentially lead to further sell-offs and increased market volatility.
Considering the surge in dormant BTC supply in circulation, it is unlikely that Bitcoin will reach new all-time highs above $75,000 in the near future. The placement of leveraged short positions in the derivatives markets also indicates resistance around the $68,400 mark. Profit-taking sell-orders and stop-loss orders from short-traders could put downward pressure on the price. However, if Bitcoin breaks above $70,000, it may face minimal resistance on its way to $75,000.
In conclusion, the Bitcoin price has started the week with a strong recovery, but more volatility is expected in the coming days. The actions of whale investors and long-term holders will play a significant role in determining the direction of the market. Traders and investors should closely monitor these factors to make informed decisions.
