The price of Bitcoin (BTC) fell from $49,000 to $40,000 in eight days after market analyst James Van Straten spotted the activity of a mysterious whale.
Whale is the name given to investors who own more than 1,000 Bitcoins. He will sell over 100,000 Bitcoins When the price of the currency reaches $49,000, point out Analyst. This is based on on-chain data from the Glassnode browser, which indicates the number of Bitcoins each entity last moved at different price ranges, as shown below.
According to research by Van Straten, whales purchased more than 100,000 Bitcoins during the 2021 bull run, when the coin was trading at $48,000. Therefore, it suggests that Bitcoin has been in the red since it fell from that price over two years ago, which would have led to profit-taking as soon as it exceeded that price.
“This caused a frenzy in the market,” coupled with the liquidation of leveraged futures positions and the phenomenon of “sell-off news,” the analyst said.
The “buy the rumor and sell the news” strategy is to buy an asset before some expected favorable event occurs and sell that asset for a profit when that event occurs, even if it is something positive, like in Bitcoin spot trading What happened before the launch. -Traded Funds (ETFs), facts reported by CriptoNoticias.
Van Straten emphasizes that due to a combination of these factors, Bitcoin posts biggest one-day drop since FTX exchange collapse.
The drop follows a massive wave of selling by whales and small investors, making it the biggest wave of profit-taking since Bitcoin hit its all-time high two years ago, CriptoNoticias reported. The move was driven by long-term and short-term holders, who moved $2.2 billion of BTC to exchanges, setting an all-time high for such transactions.
Bitcoin Could Lose $40,000
Colombian analyst Juan Rodriguez said, Another factor affecting BTC prices recently is the net flows received by the Bitcoin Spot ETF.released a week ago.
Yesterday was the worst day for the net flow of funds to buy BTC. He explained that, to be precise, they had a total outflow of $134 million, which is how much they had to sell Bitcoin.
In light of this, Bitcoin price has pulled back to the $40,000 area multiple times in the past 24 hours. Moreover, analysts say that if the downward pressure persists, a drop to the $34,000 support area is possible.