Bitcoin’s bounce has pushed the price to $91k, but traders are mixed on the coin’s next path.
BTCUSD – 4H Chart
The price of BTC has bounced from extreme panic selling to the $80,000 level, and the key resistance is now around $98,500. The 200 moving average comes in just above there at $100k.
Bitcoin’s recent bounce was strong, but it was likely a reaction move from a very strong period of selling. Analysts are now sharing their mixed opinions on the coin’s next move.
CryptoQuant dated cited exchange inflows reaching a peak of 9,000 on November 21 as the price of Bitcoin hit $80,600 on Coinbase. When crypto exchange inflows increase, it is often a sign that investors are getting ready to sell their coins.
The company’s data indicates that 45% of the total BTC sent to exchanges originated from large deposits of 100 BTC or more. This was a warning that many large whale investors were sending coins to exchanges in anticipation of selling.
“This indicates that investors and traders continue to sell Bitcoin in the context of the current price drawdown, putting further downward pressure on the price,” analysts said.
CryptoQuant also noted on Wednesday that Binance’s stablecoin reserves were at a record high of $51 billion, the highest in its history, which also implies that investors are pulling money.
Analyst James Check also noted some remaining leverage that had yet to be flushed from markets. “We wouldn’t be too surprised if we wick into the $70k-$80k zone to flush the final leverage pockets,” he said.
However, low mining margins are being seen as a reason to be optimistic. The BTC miner margin is currently at a slim 4.9%, one of the lowest readings of the cycle. Low margins have previously acted as a stabilizing force rather than a stress signal. As profitability slows, inefficient miners tend to disappear, leading to an easing in supply pressure.
The price move toward $100k will be important in the week ahead and could determine where prices end the year.
