Nicholas Merten Looks Into Reasons Behind The Latest Bitcoin Recovery
Nicholas Merten, a top crypto market analyst, says that Bitcoin (BTC) whales and large scale investors’ behavior is likely the reason behind the latest market recovery.
In a video update, Merten shared with the 514K subscribers to his DataDash YouTube channel that whales and other institutional investors holding on to their Bitcoin – regardless of the macroeconomic and geopolitical uncertainty – is likely behind the latest Bitcoin price rise.
“Over the past couple months, there’s been so many scares around the macro environment. The Federal Reserve increasing interest rates and initiating quantitative tightening to curb inflation. The war going on between Ukraine and Russia. Potentially another Covid wave.
All these different topics that got all these people pessimistic made people think that the whales, the large investors, the institutions were going to sell their positions.
On the contrary, we didn’t see any major whales dumping. In fact, we saw accumulators continue to either buy more or hold. That is proven here through the 1-year HODL wave.”
HODL w ave data groups bitcoin by age since it was last moved from one wallet to another. The 1-year HODL wave metric follows BTC that has not moved for over a year.
According to Merten, whales have accumulating BTC for the last six months, while short-term and leveraged trades have been moving the market the up-and-down.
“We saw during this time a nearly 10% increase from back in September and October all the way towards where we are here at the end of March.
It’s been nothing but a couple of months of the whales buying more and holding their positions.
All the volatility we’ve been seeing in the market is likely short-term traders and leveraged traders getting liquidated in either direction.”
The analyst concludes the session saying that regardless of BTC’s 50% decline from an all-time high above $69,000 back in November, the leading digital asset is not in a bear market.
“These trends are driven by supply contractions. When we see those higher lows in price like we’ve been seeing over the past year, year and a half, it’s a sign that the trend is not dead, and that this isn’t a bear market. Plain and simple.
If we take a look again at the (1-year HODL) model, it’s got a lot of historical relevance. But important to consider as well is that there are a lot of other means to gauge this kind of reading around supply and demand. It’s just a benchmark.”
At the time of writing, BTC trades at $47,334, up 1% on the daily and 12% on the weekly chart.
