Why Bitcoin price just hit $19,000 for the first time in 3 years – Cointelegraph

The price of Bitcoin (BTC) hit $19,000 on Nov. 24 for the first time since the historic rally in December 2017. Three key reasons are behind the dominant cryptocurrencys strong momentum.

The main factors buoying BTCs ongoing rally are whale accumulation, decreasing exchange supply and explosive volume trends.

All throughout November, Cointelegraph reported that whale clusters were steadily forming as the price of Bitcoin rallied.

These clusters emerge when Bitcoin whales buy BTC at a certain price point and do not move them. Analysts have interpreted this as a signal that whales are accumulating and that they have no intention of selling in the near term.

The difference between the ongoing Bitcoin rally and previous price cycles is that the recent uptrend has proven to be more sustainable. In fact, each whale cluster shows that every major support level BTC reclaimed was accompanied by whale accumulation.

On Nov. 18, when Bitcoin dropped to as low as $17,200, analysts at Whalemap said that the new whale support is located at $16,411. They said:

Since then, Bitcoin has seen several more dips below $18,000 but has since recovered above $18,800, sustaining its strong momentum.

Furthermore, data from Santiment, an on-chain market analysis platform, shows a similar trend. Santiment researchers found that the number of BTC whales significantly increased in recent months. They explained:

One consistent trend throughout the 2020 bull cycle has been the continuous drop in Bitcoin exchange reserves.

Investors and whales deposit BTC to exchanges when they want to sell BTC. Hence, the recent drop in exchange reserves means there are fewer sellers in the market.

A pseudonymous trader known as Byzantine General said that every time spot exchanges expand their BTC reserves, they get accumulated. He said:

The volume of both institutional and spot exchanges has been increasing rapidly since September. Open interest on Bitcoin futures and options at CME surpassed $1 billion in November, and Binances BTC/USDT pair has consistently delivered over $1.5 billion in daily volume.

Various data points also show that the spot market has been leading the rally, not derivatives or futures markets. This trend makes the rally more stable and reduces the risk of massive corrections.

When the futures market accounts for the majority of the volume during a Bitcoin uptrend, there is a large risk of cascading liquidations. This time, the spot market has been leading the rally, thus making it more sustainable.

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Why Bitcoin price just hit $19,000 for the first time in 3 years - Cointelegraph

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