The price of Bitcoin (BTC) exceeded $17,400 in a strong intraday rally. On Coinbase, BTC even came close to the $17,700 mark, setting a new two-year high. As BTC glides through the multiyear resistance above $17,000, analysts are divided on its short-term outlook. Some say that BTC is primed for a pullback as whale deposits begin increasing. Others believe there is little resistance until $20,000 and that an all-time high is likely before the next deep correction.
The momentum of Bitcoin in the past month has been particularly impressive due to two key reasons. First, during previous bull cycles, as long-time trader Peter Brandt explained, BTC saw up to nine corrections. But in the ongoing rally, BTC has seen merely two 10% corrections. Second, Bitcoin has consistently recovered from areas where corrections were expected, such as on Nov. 16 when it hit $14,774 on Binance.
However, calls for a pullback are also increasing as the market sentiment around Bitcoin heats up. Speaking to Cointelegraph, Ki Young Ju, CEO of crypto data provider CryptoQuant, said that the Exchange Whale Ratio indicates whale deposits into exchanges are rising. In the near term, this could apply selling pressure to BTC. Traders also say that the current highs of BTC near $20,000 may be front-run, leading to a correction before the level is hit.
A minor Bitcoin pullback?
When Bitcoin whales deposit BTC into exchanges, the trend typically shows an intent to sell from high-net-worth investors. According to CryptoQuant’s Tokens Transferred metric and Exchange Whale Ratio, deposits from both whales and general investors are starting to increase. This signifies that more investors are moving to exchanges to take profit on their BTC holdings. Ki said:
“Tokens Transferred (not entity-adjusted) on the Bitcoin network is increasing, indicating that whale wallets are moving their funds. And Fund Flow Ratio for all exchanges is decreasing, meaning that exchanges did not evoke these large transactions….