South Korean Whales Accumulating BTC on Exchanges, Can Coinbase Buyers Hold Bitcoin Above 30k?
Bitcoin is currently trying to solidify its position above $32,000 after experiencing high volatility over the past couple of days after the $5,000 price crash. The price volatility is primarily because of Asian whales dumping large portions of their bitcoin holdings on exchanges during the Asian market time which results in a dip in bitcoin price which is followed by a buying spree on coinbase as the US markets opens right after the Asian market closes down.
The current selling and buying spree between the Asian and US markets is contributing to the high volatility of the top cryptocurrency observed in the past couple of days. The same pattern has started to begin today a little early as South Korean exchange as 1882 bitcoin worth $60 million was just sent to Bithumb an hour ago raising the concern of a possible upcoming dip in bitcoin price.
Bitcoin’s price rise of over $34,000 led to heavy traffic and malfunctions on a number of crypto exchanges. The high demand for bitcoin at its current price and billions of spot rallies has led to BTC selling at premium rates on several exchanges especially in South Korea.
This is one of the key reasons behind whales selling large amounts of BTC to make the most profit. The massive prie rally often also lead to premium charges on coinbase as well.
Bitcoin’s Estimated Leverage Ratio Across Exchanges Dips
The Estimated Leverage Ratio (ELR) across various exchanges recorded a dip today suggesting a cautionary approach by futures traders owing to the high volatility.
ELR shows the average of leverages used by traders on the exchange. This information measures traders’ sentiment whether they take a high risk or low risk. If the ELR value is high compared to the last couple of days, it indicates traders are quite confident in their positions. Funding data such as funding rates may help traders to build a robust trading strategy with this information.
Ki-Young Ju, the CryptoQuant believes ELR is a better indicator of market overview and trader sentiment than the popular fear & greed index.
This indicator is better than the Fear & Greed index.$BTC derivative traders are uncertain about the next move, and scared. https://t.co/6MdzR5jjBc
— Ki Young Ju 주기영 (@ki_young_ju) January 5, 2021
Bitcoin in its ongoing bull rally has managed to convert most of the critical resistance at $24K, $27K, and $30K into strong support, and currently, the top cryptocurrency is trying to do the same at $32,000.
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