(John Isige – FXStreet)
– Bitcoin-British pound sterling volume surges on major exchanges amid questions of hedging demand.
– Whales could be preventing BTC price from progressing to the upside with their selling activities.
– The ongoing price correction below $19,000 might fade at $18,500, but Bitcoin price will remain in the woods.
Bitcoin price appears to be playing games with investors in move that see price action repeatedly undermined. Earlier in the week, the flagship cryptocurrency jumped to $20,200 but immediately snapped out of the northbound move to test support at $18,500.
A second weekly bullish candle on Wednesday tagged $19,500 before bears demanded a slice of the cake. Bitcoin price must reclaim its support at $19,000 to keep off potential bear aggression amid fears of declines extending to the key June lows at $17,650.
Bitcoin-Sterling trading volume pumps while BTC price struggles
The Bitcoin-British pound sterling (BTC/GBP) pair has been recording increased volumes amid questions of whether investors are buying crypto as a way of hedging against the battered fiat currency. The BTC/GBP pair is tradable on several exchanges, including Bitfinex and Bistamp.
However, it is not clear what could be driving the volume. Analysts remain divided over what could be the cause, with some citing hedging while others are fronting a growing desire to capitalize on volatility.
The pound continues to wade in murky waters after posting a record low of $1.0350 on September 26. At the time, the BTC/GDP pair recorded a whopping $881 million in volume – 12 times the usual $70 million daily average. Pressure may continue mounting on the pound due to tax-cut proposals and rising inflation.
Bitcoin price has yet to show signs of an immediate recovery, which brings into doubt the idea that the BTC/GDB pair’s volume is soaring because investors are buying crypto for hedging purposes. Besides, Glassnode’s on-chain metric on addresses’ stats shows that Bitcoin whales are on a selling spree.
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Since August 14, addresses holding 1,000 and more BTC have decreased by 27, from 2,146 to 2,119. This could mean that there is still a bigger exodus of investors with a low-risk appetite, probably because of the strict economic measures governments globally are putting in place to fight inflation.
A descending trendline drawn from the Bitcoin price peak of $25,000 in August affirms the tight bearish clasp. The last time (September 12) BTC price paced above the line, bears stepped in at $22,500 and a drop to $18,500 followed. If the trend line is left undefended now, its continuing pullback could see losses eyeing $17,650 (June support)
All eyes are glued to the bulls’ ability to keep Bitcoin price above $19,000. A daily close on top of the 50-day SMA and, by extension, the seller congestion at $19,500 could flip Bitcoin price’s short-term narrative bullish for a gradual move beyond $20,000.
Read Bitcoin Weekly Forecast: BTC’s Q3 close and what to expect in Q4?
