- Indications from whale activity on the exchanges pointed to a decrease in the sell-off
- Current market conditions do not consider BTC to be undervalued.
Although the crypto market has not had such a good time lately, Bitcoin [BTC] remains an important asset for traders. This is because the king coin is largely responsible for the direction in which the market moves.
Read Bitcoins [BTC] Price Prediction 2023-2024
While not a new development, Bitcoin faced selling pressure and underwent one price correctionthe widespread dump seemed to have cooled. It was also followed by speculation that the BTC price could stabilize soon.
To address the possibility of stability or a price increaseCryptoQuant author Crypto_Lion considered the Fund Flow Ratio (FFR) and Whale Ratio (WR). The FFR helps understand whale behavior and transaction volume on exchanges.
It’s not time to be happy yet
The metric does this by measuring the total amount of BTC flowing in and out of exchanges. This is done in proportion to the amount of BTC transferred through the Bitcoin network. On the other hand, the Whale Ratio is the ratio of the top 10 inflows to the total inflows on exchanges.
Source: CryptoQuant
When the WR is high, it means that whales are actively trading on exchanges. But when the WR is low, it implies low trading activity on exchanges. Regarding both the stats and the chart above, Crypto_Lion said:
“The selling pressure has dropped significantly. This is a recommended indicator as it shows where to monitor (exchanges or OTC) as characteristics change significantly from year to year. This year, when the FFR rises, that is the point of price increase.”
But could the waning selling pressure trigger a BTC rebound already? One measure that could play a role in this is the Bitcoin realized cap. The realized limit is a way of trying to gauge a coin’s value by looking at its stored value on the Bitcoin network. The volume-weighted average price (VWAP) is also taken into account.
At the time of writing, the realized limit was $395.81 billion. The market capitalization was also higher, at over $500 billion.
Source: CryptoQuant
Not to be fooled by the market value, the fact that the realized limit is lower than the market cap indicates that BTC was not undervalued in the current market conditions. Therefore, you may not experience a significant price increase in the short term.
Realistic or not, here it is The market cap of BTC in ETH terms
The price of BTC may remain in range
Another way to judge the possibility of a rally or not is to consider the technical angle. And from the four-hour BTC/USD chart, neither buying nor selling pressure has attempted to dominate the market over the past few days.
This quiet time has caused the Relative Strength Index (RSI) to remain at 36.16. While the RSI reading indicated that BTC was close to oversold territory, it is likely that the coin will continue to hover around $25,000 to $26,000.
Source: TradingView