The Bitcoin (BTC) price has crossed $18,500 for the first time since December 2017 by continuing its current uptrend.
It has been reported that on Coinbase, BTC even came close to the $17,700 mark by setting a new two-year high.
However, on November 16, analysts found that the Bitcoin price dipped below a parabola dating back to September. Though the trend seemed concerning, new parabolic trends could reemerge in a bull cycle.
The report said that Bitcoin has consistently recovered from areas where corrections were expected, such as on November 16 when it hit $14,774 on Binance.
Bitcoin Came Close to $18,500, with JPMorgan Analyst Calling It Alternative to Gold#blockchain #dlike #cryptocurrencyhttps://t.co/4sBJ9hqX10 — TRON AGE (@tron_age) November 18, 2020
Ki Young Ju, CEO of crypto data provider CryptoQuant, said that the Exchange Whale Ratio indicates whale deposits into exchanges are rising. In the near term, this could apply to sell pressure to BTC.
Likewise, traders also say that the current highs of BTC near $20,000 may be front-run, leading to a correction before the level is hit.
Crazy #Bitcoin price movement. $17,750 to almost $18,500 in less than 90 minutes. @coinbase pic.twitter.com/nh3wulxs8k — CoinWarz (@CoinWarz) November 18, 2020
According to CryptoQuant’s Tokens Transferred metric and Exchange Whale Ratio, deposits from both whales and general investors are starting to increase. This signifies that more investors are moving to exchanges to take profit on their BTC holdings.
“Tokens Transferred (not entity-adjusted) on the Bitcoin network is increasing, indicating that whale wallets are moving their funds. And Fund Flow Ratio for all exchanges is decreasing, meaning that exchanges did not evoke these large transactions. […] I think massive OTC deals are still on-going. That’s one of the key reasons why I’m still long-term long on Bitcoin.”
Ki further added:
“Looking at ‘Exchange Whale Ratio (72h MA)’, the BTC price is likely to face small corrections. […] When this is lower than 85%, the chances of the price continuing to rise is high. Between 85% and 90% indicates a correction, and above 90% suggests that a large drop in price can occur. We have some correction risk as this value goes above 85% lately.”
Moreover, some traders have also predicted that BTC will see a short-term top before it reaches a new record high.
ATH system load, coping so far. Helpdesk backed up a bit. Your understanding and support is greatly appreciated. — CZ Binance (@cz_binance) November 17, 2020
Similarly, Arcane Research found that Bitcoin spot volume has increased by 270% in the past month, as the clear increase in the volume of the cryptocurrency market in general shows that genuine demand is behind the ongoing bull run.
The Arcane Research weekly report reads:
“The daily volume on Thursday last week was the highest since the brutal crash in March, and the volume has stayed high over the past few days as well. This made the 7-day average go up to new highs this week. The bitcoin volume is up more than 270% over the past month.”
Thus, there is a high probability that if BTC hits a new all-time high, a broader rally could emerge.