The $112,000 Barrier in Bitcoin: Whale Sales and Long-Term Investor Confidence Clash
Bitcoin faced significant resistance again at the $112,000 level. This price rejection shapes the selling of short-term investors while creating a market dynamic that contradicts the increasing accumulation of long-term investors.
While whale wallets continue to sell, long-term investors (LTH) are sending a strong message of confidence to the market by accumulating more than 881,000 BTC in the last 30 days. According to CryptoQuant data, the 30,784 BTC moved to accumulation wallets in just one day shows that investors are staying committed to their long-term strategies despite short-term uncertainties.
Two Separate Forces in the Market: Whales Sell, Long-Term Investors Accumulate
One of the notable developments in the crypto market is the continued selling trend of large investor (whale) wallets. For example, a whale sent 1,000 BTC (approximately $106 million) to Binance. This wallet realized profits by selling a total of 6,500 BTC while still holding 3,500 BTC. This situation reflects a strategic profit-taking process rather than a complete exit.
On the other hand, the accumulation of 881,578 BTC in off-exchange wallets is a sign of long-term investors' confidence in Bitcoin's future potential. These wallets currently hold 2.91 million BTC.
$112,000 Resistance and Technical Compression
Bitcoin is struggling to break the resistance at the $112,000 level. This level has become a strong supply area where the price has been repeatedly rejected. While technical indicators present an optimistic picture with the rising support trend line, the RSI falling below 50 indicates a weakening buying power.
If Bitcoin cannot maintain the $106,000 support, there is a risk of the price declining to $101,000. Conversely, a clear breakout above $112,000 could force investors in short positions to close their positions, triggering a rapid rise.
NVT Ratio is Rising: Is Price Disconnecting from Valuation?
Bitcoin's NVT (Network Value to Transactions) ratio has increased by over 15%, reaching 36.49. This rise indicates that the market value has grown relative to transaction volume, suggesting that the price may have outstripped fundamental usage.
However, this ratio may also increase in the early stages of bull markets. Thus, the rise in NVT is not solely a peak signal; it indicates that trading activities need to be closely monitored.
Network Activity: Existing Users Active, New Participation Weak
According to IntoTheBlock data, active addresses on the Bitcoin network increased by 1.69% in the past week, indicating that current users are maintaining their interaction with the market. However, the number of new addresses decreased by 2.36%, suggesting a slowdown in new investor entries.
This table reveals that market movements are currently being driven more by existing users, indicating that the user base needs to expand for long-term growth.
Liquidation Levels: Accumulation at Critical Thresholds
According to Binance's liquidation data, long positions concentrated at the $105,000 and $102,000 levels could trigger forced sales if the prices fall below these levels. This situation can lead to increased volatility.
In contrast, holding above $104,000 could trigger a 'short squeeze' by squeezing investors in short positions. Since these liquidation clusters are areas where prices change direction sharply, it is crucial for traders to monitor these levels closely.
Conclusion: Mixed Signals in Bitcoin
As Bitcoin struggles with technical resistances, the divergence among the investor base deepens. While whale sales put pressure on prices, record purchases by long-term investors spread a strong sense of confidence in the market.
The compression area at the $112,000 level could play a key role in determining the market direction in the coming weeks. It is critical for investors to make cautious and strategic moves by evaluating on-chain data and technical levels together.
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