Bitcoin fluctuated just below the $112,000 mark on Monday as traders navigated a significant sell-off from large holders, commonly referred to as “whales,” while also recognizing signs of long-term accumulation and a robust performance from various altcoins. On-chain analytics from CryptoQuant identified over 100,000 BTC, valued at around $12.7 billion, as being withdrawn from major wallets in the last month. The analyst known as caueconomy characterized this event as “the largest coin distribution this year,” noting that whale holdings dropped by approximately 114,920 BTC, which had briefly pushed spot prices under $108,000 during the previous week. This scale of selling resembles the aggressive positions sold off in July 2022.
The ongoing reduction in whale reserves is a cause for concern, as it may continue to exert downward pressure on Bitcoin’s price in the weeks ahead. Market dynamics are being further complicated by decreased inflows into exchange-traded funds (ETFs) and lower trading volumes, resulting in the cryptocurrency landscape relying heavily on broader macroeconomic factors.
Despite these short-term challenges, the long-term outlook for Bitcoin appears more promising. Currently down only 13% from its all-time high hit in mid-August, this decline is comparatively mild against historical pullbacks. Analyst Dave the Wave noted that the one-year moving average has significantly increased from $52,000 one year ago to nearly $94,000, suggesting a likely breakout past the $100,000 threshold in October, which represents a strong structural uptrend.
Ryan Lee, the chief analyst at Bitget, echoed this optimism about supply metrics, revealing that Bitcoin’s illiquid supply has climbed to an all-time high of 14.3 million BTC, with over 70% now residing in wallets that show little spending activity. This accumulation signals a retained confidence in Bitcoin’s long-term value. Lee anticipates that Bitcoin may stabilize and regain momentum within a price range of $105,000 to $118,000, particularly if ETF inflows increase and bullish momentum indicator signals continue.
In the altcoin arena, Ethereum was trading near $4,307. Lee suggested it could fluctuate between $4,100 and $4,600 if demand for ETFs remains strong. He mentioned that upcoming network upgrades and decentralized finance (DeFi) developments could further promote independent price increases in Ethereum.
The overall market showed slight improvement, with XRP climbing 2.3% to $2.96, Solana’s SOL increasing by 3.2% to $214, and dogecoin extending its strong ascent, rising 10.5% weekly to reach $0.236. Cardano’s ADA also saw gains, growing by 6% over the past week to hit $0.865.
However, overall market sentiment remains cautious. FxPro’s Alex Kuptsikevich pointed out that while the total crypto market capitalization rose by 2.5% to reach $3.85 trillion, it still hovers below its 50-day average, reflecting uncertainties in investor appetite. The sentiment index dipped into fear at 44 over the weekend before stabilizing at 51 on Monday, indicating that traders are adopting a wait-and-see approach amid ongoing market volatility.
The seasonal tendency for weakness observed in September adds further caution, compounded by significant macroeconomic pressures. Jeff Mei, COO at BTSE, highlighted that U.S. inflation reports due midweek will likely influence the market’s next movement. He noted that unexpected high inflation figures could trigger declines in Bitcoin and Ethereum, while lower-than-expected numbers might incite a market rally.
