The latest on-chain data from July 30 suggests miners are preparing to sell Bitcoin . According to data analytics resource Glassnode, miners’ outflows to exchanges increased significantly in the last 24 hours.
If we look at previous data, we can see the last time we saw an outflow to exchanges this large, was during the March 2020 Crash, where we plummeted over 60%.
“There has been a big spike in miner outflows overnight, I’m expecting a whole lot of selling, starting real soon,” popular cryptocurrency analyst Cole Garner tweeted, along with a chart from blockchain analysis firm CryptoQuant showing a big spike in the miner outflow around 10:00 UTC on Tuesday.
Bear Market Not Over?
The common sentiment across Crypto Twitter right now is that we are propelling into a massive bull run, and will be surpassing $100K this year.
If we look at the charts, we still have three CME gaps formed in lower ranges, going to as low as $3500. This is very concerning. I have another article all about CME gaps, make sure to check it out if you haven’t already.
Another metric, which tracks the flow of coins from miner wallets to cryptocurrency exchanges, shows nearly 97% of the total outflow of 2,935 BTC from miner addresses was deposited to cryptocurrency exchanges on Tuesday.
The total 2,844 BTC that went to exchange platforms was the highest since March 26. That’s a major spike: on Monday, only 404 BTC were deposited on exchanges.
With the sudden rise in the number of coins available on exchanges for liquidation, the cryptocurrency looks vulnerable for a notable price drop. Such spikes in miner outflows have preceded price drops in the past, although they don’t necessarily mean a drop is on the way.
For example, outflows increased from 380 BTC to 1,824 BTC on Aug. 2, 2019, but the cryptocurrency extended its recovery rally to hit highs above $12,300 on Aug. 6.
It remains to be seen if the latest spike in miner outflows yields a notable price drop or traps bears on the wrong side of the market. Supporting the case for a downside move is the fact that miners have spent less than they mined in the last 24 hours, pushing miners’ rolling inventory (MRI) above 100%, according to ByteTree
Crash later this year is likely.
Contrary to the excessive amount of people buying above 11K, I think people should zoom out and not fall victim to FOMO.
The market can switch anytime, and we’ve seen this euphoria many times in the market over the last three years, all to be followed by a sudden crash.
Bitcoin has only held above $10,000 two times in history.
Both times were followed by a 70–80% crash.
We are at record high levels of Greed, and Investors are beginning to project crazy numbers like 100K or 1M by the end of the year. This is a stark similarity to July 2019, or even December 2017.
My advice is to hold off on buying for now, especially considering the CME gap at $11,700 is likely to be filled sometime in August, which could result in a sell off once the hype dies down.
Be patient, and even if we make a quick jump to 12 or 13k, avoid buying the tops! Wait for a pullback if anything, and never go all in unless we’re very cheap.
Good Luck Everyone! Happy Trading! ❤
None of my content is financial advice.
I simply provide tons of free calls on Twitter (CryptoWhale), and insight to my followers, and it’s ultimately the responsibility of each individual to make trades themselves. I hope this insight can be valuable in time, and I appreciate you reading this!
If you enjoyed, please clap this article on Medium. You can clap up to 50 times per post, and you can use it to show the author how much you liked the story.