The price of Bitcoin is experiencing downward pressure as significant volumes of the cryptocurrency are being moved to exchanges. Recently, about 65,200 BTC were shifted, coinciding with political uncertainty surrounding the investigation of former President Trump, which has negatively impacted both US stocks and the cryptocurrency market.
On November 18, Bitcoin”s price fell to approximately $92,300, a decline attributed to a critical congressional vote launching a probe into Trump. This political turbulence has created a risk-averse environment, reflected in the declines seen in major indices such as the Nasdaq and the S&P 500, down by 0.59% and 0.35%, respectively. Despite an earlier positive sentiment fueled by Michael Saylor”s announcement regarding a substantial $835 million Bitcoin acquisition, the market reacted sharply to the political developments.
Data from CryptoQuant indicates that short-term investors are capitulating at a faster rate than long-term holders can accumulate. The transfer of 65,200 BTC was executed at a loss, as highlighted by analyst JA Maartun. This influx of Bitcoin into exchanges is estimated to represent around $610 million in potential sell-side supply at current market prices, which could impede any immediate recovery.
Trading volume for Bitcoin surged by over 34% on the same day, a sign of increased activity despite the flat price action. Generally, substantial deposits to exchanges are indicative of weaker prospects for a price rebound, as they often amplify selling pressure.
Market Dynamics and Technical Analysis
The current trading price of Bitcoin hovers around $93,317. However, technical indicators suggest that it may face challenges unless it can reclaim the critical $99,000 level. A failure to do so could lead to a retest of the projected support zone around $89,000, which aligns with the double-top pattern observed in recent trading sessions.
The completed double-top formation on the 12-hour chart indicates a bearish trend, with the target for further declines estimated at approximately $89,177. The Bollinger Bands are also showing signs of downside expansion, with the upper band resting at $108,961, a level that Bitcoin must breach to negate the current bearish outlook. The mid-band around $99,069 has become a significant resistance level, further emphasizing the need for Bitcoin to reclaim this range to shift momentum.
Currently, the Relative Strength Index (RSI) on the 12-hour timeframe is positioned at 35, indicating a potential for a relief bounce. However, historical data suggests that Bitcoin often continues to decline when the RSI remains flat below 40 during periods of high exchange inflows, as seen this week. Without a significant catalyst to alleviate the political pressures surrounding the crypto-friendly Trump administration, Bitcoin”s price may remain vulnerable to further corrective moves.
