Bitcoin enjoys positive sentiment after turbulence
Bitcoin fell briefly below $25,000 late last week after hitting a multi-month high above $31,000. However, the price seems to have fully recovered following a week of turbulence with government policies, regulatory battles, and ETF filing.
The rebound showed momentum today when the price of the coin crossed the $28,000 mark.
Bitcoin recovers fully
Bitcoin price has rebounded 50% this year following a year of winter and industry-wide setbacks.
The price rose more than 5% in the last 24 hours to reach its highest level since May. Data from TradingView show that the pioneer cryptocurrency is currently exchanging hands at $28,155.
The uptrend now puts the coin above its 100-day moving average at $27,619. The price also extend the topside general trend line at $27,300.
The surge in price has been associated with the rise in positive sentiment after asset manager BlackRock filed for a spot Bitcoin exchange-traded fund last week. This has also affected other Bitcoin-related offerings. For instance, Grayscale’s Bitcoin Investment Trust saw a increase 400% in trading volume since the news. Fidelity also announced it had started trading Bitcoin and Ethereum.
Investors are optimistic as big names like Fidelity and BlackRock show their bullish hands towards crypto. These asset managers investing in risk assets like Bitcoin have propped up investor confidence and removed the mental barrier to buying BTC.
Bitcoin realised profit and loss among BTC holders have also been in steady decline. Data from data analytics firm Glassnode show that realised profit and loss margins have fallen to October 2020 levels.
The realized profit and loss levels are now crucial because they reveal how much profit- and loss-taking has occurred in the market. Profit-taking happens when investors sell their Bitcoin for more than they paid for it, while loss-taking happens when they sell it for less than they paid. A decrease in either of these suggests that there is currently less selling taking place in the market.
Since the selling pressure is easing, this is bullish for the price of bitcoin. As investors choose to hold rather than sell, it also means that there will be less BTC supply accessible on the market.
Read more: What is the Bitcoin Lightning Network and how can I access it?
Whales increase exposure
Bitcoin whales have continued to accumulate notwithstanding the recent negative events in the market.
Latest data from Santiment, whales have increased their exposure by around $3.5B since the first week of April.
These whales include holders of 1,000 to 10,000 BTC.
The 1,000-10,000 group has seen a rise in supply recently, as shown in the graph above. The whales have increased their holdings by around 131,600 BTC or about $3.5B since the first week of April.
These whale investors appeared to be regularly adding to their addresses as the price declined, presumably in an effort to buy at the low point.
Disclaimer: CryptoPlug does not recommend that any cryptocurrency should be bought, sold, or held by you. Do conduct your own due diligence and consult your financial advisor before making any investment decisions.
