Over the past few hours, Bitcoin (BTC) has rapidly exceeded $ 11,000, from $ 10,500 in early October. Analysts attribute the sharp change in Bitcoin’s direction to three main factors.
Potential catalysts are whale swarms, increased institutional demand, and $ 10,500 in support forces.
Either the whales accumulate or refuse to sell them
Earlier this week, Cointelegraph reported that activity in whale groups indicated strong demand for whales from Bitcoin and Ethereum. In the cryptocurrency market, individual investors who own massive amounts of Bitcoin are considered whales.
Whalemap data shows that whales were likely buying bitcoins from $ 10,370 and above, and on October 8, analysts said the $ 10,570 support had continued. This indicates that the whales bought a significant amount of Bitcoin in the $ 10,407 to $ 10,570 range.
Since whales typically account for most of the buy-in and pressure from sellers in the bitcoin market, their build-up is an important catalyst.
Institutional demand is rising due to the large investments in Bitcoin.
In the past two months alone, two groups of billions of dollars have made public purchases of bitcoin in bulk.
MicroStrategy first reported that it acquired $ 250 million Bitcoins on August 11th. This was followed by another statement that said they had acquired another 175 million Bitcoins.
After MicroStrategy’s announcement, the $ 81 billion Square payment company announced that it has acquired $ 50 million in BTC.
According to Peter Brandt, an experienced market analyst, Bitcoin’s daily and weekly charts indicate a “big buy signal” after the Square investment.
Brandt stressed that the investment of a large company in Bitcoin is a very important event for BTC. It is without:
“The fact that a global company is now putting $ BTC on its balance sheet matters. The weekly and daily charts are ready to give a strong buy signal.”
The daily volume of enterprise-focused bitcoin exchange including LMAX Digital and Bakkt has grown steadily since August.
In addition to favorable fundamentals such as whale herds and high hash rates, the increased appetite of institutions for BTC is adding additional power to the perceived momentum in the bitcoin price.
Support continues at $ 10,500
The $ 10,500 area has been an important support level for Bitcoin over the past three months. This is historically significant and plays a major role in short-term price cycles.
Technically speaking, maintaining the support level of $ 10,500 is critical to maintaining Bitcoin’s upward trend. The level marks the July 2019 peak and indicates that BTC is using its previous peak to continue the recovery to new highs.
Ki Yong Joo, CEO of online analytics company CryptoQuant, said the net flow of exchanges fell to an annual low.
Usually sellers place bitcoins on exchanges in order to sell the dominant cryptocurrency. Thus, when there is no BTC reserve on the trading platforms, this means less pressure from the sellers.
“Net inflow of BTC All Exchanges (MA30) recently hit an annual low. In most cases, net outflow in the exchange is likely to remain negative when the bullish rally begins. I would say the bullish gains in 2017 were the same.”
The combination of lower selling pressure, higher institutional demand, and favorable technical structure suggests that Bitcoin has had some success in moving $ 11,000 from resistance to support.