In the bitcoin (BTC) Yesterday morning’s market update, we already warned of a possible deeper dip. At first, bitcoin seemed to hold, but this morning the price made a quick move down.
The bitcoin market is still strongly driven by uncertainty surrounding macroeconomic developments. This mainly concerns the ever-rising tensions in Ukraine and high inflation, coupled with fears of interest rate hikes in March by the Federal Reserve.
Bitcoin price dips even deeper
From bitcoin price dipped below $40,000 shortly after yesterday’s market update, then touched $39,750. The price was then able to recover back to $40,000 and held there for the rest of the day and night.
Until early this morning then. By 4 a.m. this morning, bitcoin lost traction on this $40,000 and the price plummeted. Bitcoin briefly found support around $38,850, but the price quickly fell through there too. Bitcoin comes in at $38,250 at the time of writing Binance and €33,750 on Battle† Bitcoin fell by a whopping 4.4% in a few hours this morning.
Can bitcoin make a bounce here?
Despite all the uncertainty and fear in the financial markets, many analysts remain very bullish about the bitcoin price. Around this $38,000 should be a lot of support, potentially leading to a strong bounce can lead. A positive daily & weekly close could at least bring back some confidence.
Just quick update, I am looking for a potential bounce of this MA on RSI…Daily close in 17 hrs..that will be important to see at what level we close..MFI still trending up (volume and money flow still showing positive signs) pic.twitter.com/KZkcMBfSgo
— Rickus (@rickus_trades) February 20, 2022
Data interpretation is currently leading to a disagreement about whale behavior. Some data shows that investors are still accumulating. This is how the Canadian bitcoin spot saw exchange-traded fund (ETF) of Purpose last Friday the largest influx ever, reports Jan Wüstenfeld:
The Canadian Purpose #Bitcoin spot ETF just saw one of its biggest inflows ever on Friday! 🇨🇦Adding almost 1.2k $ BTC in one day. Only surpassed by inflows on one of its first trading days on Feb 22, 2021. AUM now at a new ATH with 32.26k bitcoin! 🚀 pic.twitter.com/DOO3OtocQ3
– Jan Wüstenfeld (@JanWues) February 19, 2022
However, according to analyst Ali Martinez, the number of whales with 100 to 100,000 BTC has remained about the same in recent weeks. That could indicate that they are waiting for an even deeper dip before starting to accumulate again. Ecoinometrics also reports that investors may need to accumulate stronger to pull the price out of this downtrend.
The number of whales on the network with 100 to 100,000 $ BTC has remained flat since Feb 1. These wealthy market participants do not appear interested in buying #BTC at the current price levels and could be expecting to buy #Bitcoin at a discount. pic.twitter.com/HqGTzD9guP
– Ali Martinez (@ali_charts) February 20, 2022
#Bitcoin will need much more pressure coming from hodlers accumulating coins to get out of this drawdown.
Right now the whales addresses aren’t following through. Not great in the current macro environment.
📉🧐👇 pic.twitter.com/PXZxSouaws
— ecoinometrics (@ecoinometrics) February 20, 2022
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