- Bitcoin retail investors were gone as soon as they arrived.
- BTC has increased by 3.07% over the past week.
Since reaching $100k nearly three weeks ago, Bitcoin’s [BTC] has struggled to break this barrier. As such, despite the recent price pump, Bitcoin has continued to trade sideways.
At the time of writing, Bitcoin was trading at $97,834, marking a 0.31% decline in the daily charts. Before this dip, BTC had been moving upward, rising by 3.07% in the weekly charts.
This volatility is largely associated with declining retail interest as the market seeks stability while BTC moves from weaker hands to stronger ones.
Bitcoin’s retail investors are gone
According to CryptoQuant, Bitcoin’s retail investors disappeared from the market as soon as they arrived.
Source: CryptoQuant
Based on the 30-day variation in retail demand, as BTC approached $100k, retail demand variations surged by over 30%.
A surge in retail demand usually signals heightened interest, enthusiasm, or the fear of missing out among smaller investors.
Historically, when retail demand variation exceeds 15%, it often precedes a local top. This is what happened after Bitcoin reached its new ATH of $108k.
After the market reached this level, a correction ensued, followed by a 16% decline in retail demand. Retail investors are known for being emotional reactors and quickly exit their positions during corrections.
A drop below 10% indicates that retail interest has dropped significantly. However, this drop creates a buying opportunity for large and experienced traders.
After such declines, the market has frequently experienced a bullish rebound as weak hands capitulate and stronger hands accumulate.
What it means for BTC
According to AMBCrypto’s analysis, Bitcoin is experiencing a shift in market activity from retail traders to smart money accumulation.
This drop in retail demand signals that markets are cooling off after a speculative frenzy. Therefore, BTC has moved from weak hands to stronger hands.
Source: CryptoQuant
The recent drop in the Spent Output Profit Ratio (SOPR) indicates a shift in ownership and market activity. Despite the decline, the SOPR remains at 1.01, signaling that holders are not willing to sell at a loss.
This market behavior suggests stronger hands in the market, indicating that investors are confident in holding their positions even during market corrections.
Source: CryptoQuant
This accumulation trend is further evidenced by the decline in the exchange whale ratio. The whales’ supply to exchanges has dropped to 0.37, signaling HODL behavior.
Whales are sending their BTC tokens to private wallets, indicating bullish sentiment as they anticipate further gains.
Read Bitcoin’s [BTC] Price Prediction 2024-25
Simply put, the drop in retail demand has provided large holders with an opportunity to accumulate BTC at lower prices. These conditions position Bitcoin for more future gains. Therefore, if the current market conditions hold, BTC will reclaim $98,700.
A move above this level will strengthen Bitcoin to reclaim $100k. Conversely, another market correction could see BTC drop to $96,100.
