Bitcoin Price Drops Below $ 18,000, Time To Watch For ‘Whale Pools’ Support Zones
The price of Bitcoin lost the support level of $ 18,000, but several groups of whales at lower levels suggest that the drop will be bought aggressively.
The price of Bitcoin (BTC) fell below the support level of $ 18,000 on November 22. This drop comes after BTC continually saw high institutional and OTC (off-market) trading volume in November. Data suggests that growing institutional demand was likely one of the main catalysts for BTC’s price surge to $ 18,965. According to data from Skew, the volume of Grayscale Bitcoin Trust in the OTC markets increased significantly in the fourth quarter.
OTC markets are stock exchanges in the US that allow institutional and accredited investors to buy various securities. Grayscale Bitcoin Trust operates in these markets, similar to an exchange-traded fund (ETF).
This Bitcoin rally is led by institutions
There is a clear difference between the current uptrend and the 2017 rally. This time, Bitcoin has shown more composure and stability throughout the rally, consecutively recovering the main resistance levels.
Bitcoin saw a large increase in spot volume, open interest in futures exchanges, and institutional demand. However, various metrics, such as Google Trends, have shown that mainstream public interest in Bitcoin is relatively low.
The combination of the two factors mentioned above suggests that institutions have likely been the main driving force behind BTC’s recent rally.
The large participation of institutions in a prolonged Bitcoin rally is optimistic because institutions are likely to accumulate BTC as part of a long-term strategy.
This trend explains why most of the major drops Bitcoin experienced in November saw aggressive buying. As Cointelegraph reported, Dan Tapiero, co-founder of 10T Holdings, said that “the big kids will now buy the dips.”
Tapiero also emphasized that actual fundamentals are driving the current trend, as opposed to the mania seen in 2017. He said:
“The third wave will dwarf the 2017 movement and should persist for several years.”
Michael Novogratz, a billionaire investor in Bitcoin, also said that BTC became an institutional asset along the way.
In recent months, more institutions, hedge funds, and investment banks started comparing BTC to gold. Novogratz said on CNBC:
“Bitcoin is now an institutional asset. Point. The good news is that most institutions have not yet entered. That is why 2021 will be as good or better than 2020. “
3 levels of whale groups to watch out for as BTC sinks below $ 18,000
Whales, or high net worth investors, often use over-the-counter markets and exchanges simultaneously to accumulate large amounts of Bitcoin.
Throughout November, analysts at the on-chain analytics firm Whalemap discovered the appearance of large groups of whales.
Whale groups are the price levels at which whales buy BTC and do not move their holdings.
Whalemap data shows that $ 16,411, $ 16,278 and $ 15,691 remain as large groups of whales. So even if BTC suffers a short-term pullback, the aggressive buildup of whales in November has established all-important support areas.
In the near future, following BTC’s small correction from $ 18,865 to less than $ 18,000, the whale groups are expected to act as important support levels. The price levels of $ 17,300 and $ 16,411 remain the main support levels.
Disclaimer: This press release is for informational purposes information does not constitute investment advice or an offer to invest. The views expressed in this article are those of the author and do not necessarily represent the views of infocoin, and should not be attributed to, Infocoin.