Just shy of its ATH, Bitcoin continues to consolidate with long-term investors starting to accumulate again for the first time since December 2023. With that, the historic launch of Spot Ethereum ETFs has approved in the United States.
Bitcoin/Ethereum: Bull Market Correction Drawdowns
The 2015-17 uptrend occurred during Bitcoin's infancy when there were no Derivative available for the asset. The parallels we can draw with the current market structure suggest that the 2023-24 uptrend could be a largely market driven one. This view is supported by the launch and inflows of US Spot ETFs.
For Ethereum, it is worth noting that there has been a slower recovery compared to Bitcoin. ETH has also underperformed other leading Cryptoasset over the past 2 years, manifesting itself in a weaker ETH/ BTC ratio.
However, this week's approval of the US Spot Ethereum ETF was an unexpected development and could provide the necessary catalyst to stimulate strength in the ETH/ BTC ratio.
Bitcoin: Exchange Whale Ratio
In the Bitcoin market, large investors, or whales, play a key Vai in moving prices. Let's XEM at how whale activity has changed over the past 144 hours and how these movements have affected the price of Bitcoin.
The chart shows the evolution of Bitcoin price and whale activity (Whale Rate) over time. At the top of the page, we see Bitcoin's price movements, while the blue area below represents the intensity of whale transactions.
Whale activity indicates the participation of large investors in the market. If this ratio is high, it means whales are making important transactions. Recently, the whale activity rate has continuously increased, indicating that large investors are gradually making more transactions.
The declines marked with red arrows on the graph coincide with periods when whale activity rates increased. This shows that large investors are selling, leading to a drop in price. Recently, whale activity rates have fluctuated at high levels. This creates constant pressure on prices. In other words, even if whales don't make big sales, their significant ownership prevents prices from rising.
Important when evaluating this situation. Tracking the movements of large investors can be helpful in predicting price changes. Especially when whale activity is high, be prepared for sudden drops in prices.
In short, whales have a major influence on the Bitcoin market. Tracking their movements can help us better understand the market and make smarter investment decisions.
Bitcoin: ETF Flows, Issuance & Exchange Netflow
Bitcoin price surged to a new ATH of $73K in early March, at the same time long-term holders were Capital a significant amount of supply. This seller created excess supply, leading to a period of correction. Over time, prices adjust and seller exhaustion begins to give way to a re-accumulation mechanism.
This played out in outflows from Bitcoin ETFs throughout April. As the market sold off to $57K, ETFs saw large net outflows – $148 million/day.
However last week, ETFs saw significant net Capital of $242 million/day, suggesting that buy-side demand has returned. XEM the daily selling pressure of Miners since the halving is 32 million USD/day, the buying pressure of ETFs is almost 8 times larger. This highlights the impact from the ETF, but also the impact from the Bitcoin Halving event.
Bitcoin: Longing-Term Holder MVRV
The MVRV ratio for LTH reflects their Medium unrealized profit multiple. Historically, the transition period between bear market and Bull market saw LTH trading above 1.5 but below 3.5
and can last from one to two years.
If the market uptrend remains sustainable, forming new ATHs in the process, then the unrealized profits held by LTH will increase. This will greatly enhance their sales momentum and eventually lead to a level of pressure from the sell side that gradually dries up the demand side.
Bitcoin: Longing-Term Holder & Grayscale ETF Position Change
We will evaluate LTH's spend rate through the 30-day net position change in their supply. In the run-up to the March ATH, the market experienced its first major LTH distribution.
During the last two Bull markets, the LTH net distribution rate reached a significant level of 836k to 971k BTC/month. Currently, net selling pressure peaked at 519k BTC/month at the end of March, with approximately 20% of this coming from Grayscale ETF holders.
The cumulative state shows that the total LTH supply increased by about +12k BTC/month.
Summary
After long-term investors allocated significantly when the price reached ATH $73K, sell-side pressure has decreased significantly. Long-term holders have since started accumulating again for the first time since December 2023. Additionally, Spot Bitcoin ETFs also saw a clear increase in demand, experiencing positive Capital inflows, reflecting significant purchasing power.
Furthermore, with the US approval of the Spot Ethereum ETF by the SEC. This further reinforces the growing adoption of digital assets throughout the traditional financial system and is a major step forward for the industry.
What do you think the upcoming market will be like? Let's Chia our views in Coinmoi 's Telegram Group . See you on the 23/2024 issue of Onchain to XEM how the indexes fluctuate during this time.
The article Onchain week 22/2024: Waiting for Bitcoin Bull market appeared first on CoinMoi day.
