Whales taking profits, BTC testing $30,000

Bitcoin reached a new high of $31,818 last Thursday. The next day, we voiced concern over the potential trend reversal due to the falling number of Bitcoin addresses with balances exceeding 100 and 1000 tokens, implying that big players were taking profits (the same thing happened in April 2023 after Bitcoin rose above $31,000, preceding the drop below $25,000). Since then, Bitcoin has been continuously testing psychological support at $30,000. At the same time, technical indicators like RSI, MACD, and Stochastic started to develop bearish structures on the daily time frame, and volume remained relatively low. To support the bearish thesis in the short-term, we would like to see Bitcoin drop below support at $29,508. In addition to that, we would like to see MACD cross below the midpoint and DM+ and DM- converge (eventually performing a bearish crossover). Contrarily, to support a bullish thesis, we would like to see Bitcoin stabilizing above $30,000 in the next week or so (and some technical improvements on the daily chart). With regard to this possibility, we will continue to pay attention to the number of wallets with large balances. If the decline among big holders stops, it will be slightly positive (and very positive if the number starts to grow again, suggesting accumulation among big players).

Illustration 1.01

Illustration 1.01 shows the daily chart of BTCUSD and simple support/resistance levels. The red arrow indicates a decreasing volume over the past month, accompanying the rising price, which raises a question about the lack of buyers at elevated price tags (which is somewhat worrisome, considering that big players are selling).

Illustration 1.02

Illustration 1.02 displays the weekly RSI. Interestingly, during recent highs in the price of Bitcoin, the RSI peaked only slightly below 70 points. A failure of the RSI to peak above 70 points is often associated with bear markets.

Technical analysis gauge
Daily time frame = Slightly bearish
Weekly time frame = Slightly bullish
*The gauge does not necessarily indicate where the market will head. Instead, it reflects the constellation of RSI, MACD, Stochastic, DM+-, ADX, and moving averages.

Please feel free to express your ideas and thoughts in the comment section.

DISCLAIMER: This analysis is not intended to encourage any buying or selling of any particular securities. Furthermore, it should not be a basis for taking any trade action by an individual investor. Therefore, your own due diligence is highly advised before entering a trade.

Comment:

There was no significant change in the number of addresses with balances exceeding 1000 Bitcoins yesterday (compared to Tuesday); meanwhile, the number of balances with 100 or more Bitcoins decreased slightly.