Investors can track Bitcoin whale transactions to derivatives exchanges to mark market bottoms
According to a CryptoQuant, Bitcoin whales follow a defined pattern of trading to prevent losses during capitulation events, which may be utilized as a significant signal of the market bottom.
Powerful Bear Market Bottom Indicator – $BTC Exchange Inflow Mean
“Whales and funds tend to send their BTC to derivative exchanges to set or cover long positions.”
by @eth_whalehunterRead More👇https://t.co/cksaB0CmYE
— CryptoQuant.com (@cryptoquant_com) October 14, 2022
Bitcoin Whales Create Genius Plan to Curb Losses
The verified pseudonymous analyst ‘eth whale hunter said in a ‘Quicktake’ on the crypto market analytics platform that whales and funds tend to transmit their BTC to derivatives exchanges to create or cover long positions during capitalization events.
Following these whales can provide investors with information about the market’s bottom. The analyst claims that watching the Bitcoin Exchange Inflow/Outflow Mean indicator in particular “is a credible long-term bottom indication.” This indicator’s values to watch for are BTC Inflow larger than 2.5 BTC and Outflow greater than 10 BTC. These levels represent BTC’s local bottoms. He did, however, advise traders to employ additional on-chain indicators such as Net Unrealized Profit/Loss (NUPL), Puell Multiple, Market Value to Realized Value (MVRV), and BTC Hashrate, adding that investors can make alternatively dollar cost average (DCA) into the market.
The whale loss mitigation pattern has been established as market whale activity has increased. Whale investors have been blamed for the significant decline in Bitcoin exchange reserves, which have plummeted to 8.7% of the total circulating quantity. Similarly, the investigation identified a single whale that spent over $500 million BTC purchases since September, adding over 5,000 BTC during that time.
Read more:
- After Paying 1.03 BTC To A “Confirmed Giveaway Scam,” Bitcoin Investor Became A Victim Of A Scam
- Citing Voltaire, JPMorgan Boss Jamie Dimon Said He Will Never Buy Cryptocurrencies
- Bitcoin Price & Altcoins Were Holding The Same Range They’d Occupied Before The Latest Inflation Figures