Bitcoin's 30% Rally in Two Weeks Puts Bitcoin Whales Back in Accumulation Mode

Addresses holding at least 1,000 bitcoins, so-called whales, have begun accumulating more coins during the recent market recovery. The addresses had a combined supply of 8.096 million BTC as of Feb. 10, compared to 7.95 million on Jan. 24, according to Coin Metrics.

Bitcoin whales and institutional inflows

During Bitcoin's recovery over the past two weeks, buying sentiment among the wealthiest cryptocurrency investors has eased as the currency rallied from a 2022 low of $33,000 on Jan. 24 to around $43,500 on Feb. 11. up.

During the recent bitcoin price rally, small bitcoin investors (so-called “fish”) in addresses holding less than 1 BTC also joined the accumulation frenzy.

At the same time, the data resource Ecoinometrics presents Coin Metrics data in the form of clusters, showing the simultaneous accumulation behavior of Bitcoin whales and fish.

Interestingly, these clusters look the same as BTC did before its November 2021 all-time high of $69,000.

Ecoinometrics analyst Nick wrote in a report released by the Fed on the 7th: "In this cycle, the price rebound is closely related to the simultaneous buying of fish and whales for an extended period of time," adding:

"I don't know if this signal will continue to point to a sustained rally, but hey, it's working fine for now."

A report from CoinShares this week also showed that crypto funds saw increased inflows last week. Notably, capital injections into these funds have quadrupled to $85 billion, with $71 million of that going into bitcoin-focused investment products, suggesting renewed institutional interest is also driving BTC’s price recovery.

'It's just heating up now'

Nick believes that Bitcoin's valuation has plenty of room to grow in the coming months, citing the so-called "comprehensive risk score," which is derived from four parameters: risk of market overextension, risk of low demand and high supply situations, risk of Profit-taking by holders, and the risk of increased selling pressure.

The results are shown in red and blue, which indicate hot and cold markets, respectively. The hotter the market, the greater the selling pressure.

“Right now it’s just heating up,” the Ecoinometrics analyst said, adding that “theoretically, there’s no impediment to higher prices other than a lack of momentum.”

BTC Price Levels to Watch

Meanwhile, the on-chain data tracking program from Whalemap expects Bitcoin’s “current resistance range” to be $46,200 to $49,000, citing higher trading activity in this price region in the past.

Likewise, the firm noted that the $41,400 to $42,400 range is now acting as support, as seen in the chart below.

It noted: “Based on whale accumulation, the closest on-chain resistance is only around $47,000.