Bitcoin is under pressure at the time of writing, looking at the trends of the past two weeks. Despite the rebound in September, bulls started October on the wrong foot, falling from around $66,000.
Although the coin is up in the air at the time of writing, bouncing below $60,000 after the Oct. 10 skid, buyers need to prove they’re in charge.
Bitcoin Whales collect 1.5 million BTC in 6 months
While fundamentals are closely watched, on-chain data can show where the market could be heading. In a post on x, an analyst notes that Bitcoin whales could take advantage of the low prices that are accumulating.
In the past six months alone, whales owning at least 1,000 BTC have collectively acquired 1.5 million BTC. As more coins flow to the whales, it could indicate that they are optimistic about what lies ahead and are buying despite deteriorating market conditions.
Since March, when prices rose as high as $73,800, Bitcoin has been falling, discouraging lower lows and spreading attempts for fear of missing out among traders. Technically, the all-time high is a crucial resistance for buyers to overcome, signaling a new trajectory for the world’s most valuable coin.
In the short to medium term, buyers need to clear $66,000, $70,000 and especially $72,000. If the rise is related to growing volume, Bitcoin could spike, echoing the whales’ optimism and lifting the broader market.
Rising inflation and accommodative monetary policy can stimulate demand
Several factors could drive the currency in the coming weeks. Recent market data shows that inflation is rising in the United States. Data from Trading Economics shows that inflation rose to 2.4%, up from the predicted 2.3% last year, despite economists’ predictions. Risky assets like Bitcoin tend to perform well in an inflationary environment.
In addition to rising inflation, most central banks are cutting interest rates even further. Following the interest rate cut in September, the US Federal Reserve plans to further reduce fund rates in the coming months and early 2025.
Other central banks, including those in the European Union, the United Kingdom and other jurisdictions such as Chinahave followed suit and lowering interest rates.
With the economy flooded with cheap money, global liquidity will rise and more capital will be poured into BTC and other quality assets. Accordingly, there is a good chance that prices will adjust to the trend printed in the first quarter of 2024.
Feature image from Canva, chart from TradingView