Can Whales Shield Bitcoin from $48K Downside?

Bitcoin may still fall below $50,000 if its remaining bid support weakens, according to new analysis. In a post on the social media platform X (formerly known as Twitter) made on June 14, renowned trader Peter Brandt offered some cautious advice to Bitcoin enthusiasts.

Brandt addressed Bitcoin’s hesitant traders, cautioning them that they must maintain support at the crucial $60,000 level. Bitcoin’s price, which recently soared to $67,000, has been a hot topic as yet another potential breakout failed to materialize. Earlier this week, BTC/USD briefly touched $70,000, only to fall back into a familiar trading pattern that has persisted for weeks.

Despite the market volatility influenced by U.S. inflation data, Bitcoin could not establish a strong upward trend, disappointing many hopeful traders. Brandt suggested that if Bitcoin cannot sustain above $60,000, it might be susceptible to even deeper declines. He noted that breaking through the $65,000 mark could lead to a drop to $60,000, and failure to hold that level might see the cryptocurrency falling as low as $48,000.

This scenario marks a potential retreat for Bitcoin, which last traded below $50,000 in mid-February, just a month before it achieved its current all-time highs of $73,800. These record highs have since become a challenging resistance level. Data from the trading suite DecenTrader reveals significant liquidity barriers at these levels and higher.

Another trader, Skew, emphasized the difficulty in overcoming these resistance levels. According to him, a substantial narrative shift is likely necessary for the market to attract the bidding needed to push through the barriers present around the $70,000 level.

Not all analysts are pessimistic about Bitcoin’s future price movements. Some market observers have pointed out that Bitcoin whales, large holders of the cryptocurrency, have been increasing their BTC exposure at recent price levels—an encouraging sign. The number of whale entities holding at least 1,000 BTC is nearing record highs.

Willy Woo, the creator of the on-chain data platform Woobull, noted that this whale activity can be seen as a bullish signal. He explained that in previous market cycles, the FOMO (Fear of Missing Out) phase of the bull market began when these large holders started selling into price rallies, effectively reducing their holdings.

Crypto investor and YouTuber Quinten also weighed in, citing data from the on-chain analytics platform CryptoQuant. According to Quinten, whale purchases recently amounted to $1.3 billion, a significant indicator of market confidence among these major players.

This contrasting environment creates a complex outlook for Bitcoin. While technical indicators and some experts like Brandt urge caution with potential drops ahead, the behavior of large investors offers a glimmer of hope. Whales accumulating Bitcoin at these levels could spark renewed confidence and buying activity, potentially averting the feared downturn.

The Bitcoin market remains highly dynamic and influenced by a variety of factors. Traders and investors must therefore navigate this landscape with a balanced perspective, considering both the potential for further declines and the bullish signals from whale activities.