Bitcoin is up 80% this year. After starting this week on a bright note, the world’s largest cryptocurrency has regained a foothold at $30,000, but the bears have quickly intercepted and pushed the price below recently.
While the rally may have stalled near this psychologically crucial threshold, its strong market performance so far stands in stark contrast to 2022, essentially indicating that a favorable regime shift is underway.
More importantly, BTC whales continued to show an aggressive accumulation trend.
After a month-long dumping spree, whale addresses containing 100-1k BTC are back in the accumulation game. According data from crypto-analytics firm Santiment, this cohort of investors added over 20,000 BTC to their bags in the past two days.
In addition to whales raking Bitcoins, Glassnode data suggests that another cohort of investors, known as “Shrimp,” with less than 1 BTC also “significantly” increased their on-chain balance.
The analysis revealed that the change in hoarding behavior was significant after the catastrophic drop in Terra ecosystem tokens last year. Following this event, retail participants accelerated their “absorption” of BTC and managed to increase their relative share of circulating supply by 1.78%.
This accumulation trend will be crucial in helping Bitcoin sustain the rally for longer.
Sell in May and walk away?
So far, Bitcoin has outperformed traditional risk assets, such as the tech-heavy Nasdaq index, by a significant margin. The crypto asset could be poised for gains if the pattern continues.
Industry experts believe Bitcoin is hotly trailing its early 2019 surge and prices could peak at around $45,000 in May. In his recent reportK33 Research said the pullback and recovery cycle is remarkably similar to the pattern seen in the 2018-19 bear market in terms of duration and trajectory.
While a 1:1 mirroring of the current pullback to previous pullbacks may not occur, the resemblance to the 2018 pullback is staggering, the analysis observed.
“While history is far from repeating itself in the same way should the fractal continue, BTC would peak around May 20 at $45,000.”
K33 senior analyst Vetle Lunde noted that Bitcoin’s year-to-date rise shows all signs of a “hated bull run,” which he explained as “a rally where holders feel underexposed after a very traumatic year, where investors are derisked”. in anticipation of a further decline. The hated 2019 rally ended with a “significant high” before the flagship crypto resumed trading with a 40-60% pullback from its 2017 all-time high.
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