Bitcoin Crashes Below $50K. Whales are Coming Out to Feast
The Descending Channel Proves Its Worth Once Again, Sends Bitcoin Higher.
Following what many call Red Monday, Bitcoin, Ether, and other cryptocurrencies have been on a bit of a roller coaster. On Monday, we saw a sharp move down, continuing last week’s 13.1% drop – the biggest since the FTX exchange drama back in 2022.
Over the weekend, Jump Crypto the crypto arm of Jump Trading started moving hundreds of millions of dollars’ worth of various coins. They even made a huge $46 million transfer of ETH. This had some people wondering if Jump Crypto is facing bigger problems and possibly liquidation of assets.
A lot of the panic comes down to fears of a potential US recession, which aren’t exactly helped by the turmoil in the Middle East. On top of this, July’s Non-Farm Payrolls (NFP) report came in lower than expected, and the unemployment rate ticked up. This slowdown in the labor market pushed the Nasdaq and S&P 500 lower. There is also speculation about a 50-bps rate cut by the Fed during their September meeting. This combo of economic jitters and global instability is making investors more cautious than usual.
Whale Sentiment Is Still Positive
But it looks like crypto whales are still optimistic: according to data from CryptoQuant, over 404,000 Bitcoins have moved to permanent holder addresses in the last 30 days. The CEO of CryptoQuant, calls this “clear accumulation.” Plus, there’s been a hefty inflow of 40,000 Bitcoin to US spot exchange-traded funds (ETFs) in the same period.
Despite the recent dip, Bitcoin has bounced back to a high of $62,729 from a low of $49,577 on Monday, August 5. At the time of writing, Bitcoin is changing hands at $60,930. Ethereum has also regained its footing after Monday’s low of $2,100. It is now trading at $2,675.
So, while the crypto market is definitely experiencing some turbulence, it seems like there are still plenty of traders/investors taking the long view and holding on tight.
Chart Analysis – BTC/USD
The descending channel is at it again. After what appeared to be a break of the lower part of the channel, Bitcoin recovered and is now attempting to break the 50-day Moving Average.
If recent history repeats itself, the pair is headed towards the upper boundary of the channel, in the $65,000 area. However, we can see a series of lower highs and lower lows, which are the stamp of a downtrend. On the other hand, the RSI was just oversold and this will probably help a stronger recovery.
