The cryptocurrency market continues to move sideways without showing strong price changes. The behavior is very similar to the stage of regrouping trading forces, clearing the market of weak hands.
Small players and newly arrived hamsters leave the market with losses during April, fearing to lose everything they have invested in cryptocurrency, but their volumes are happily picked up by big players, accumulating them in financial portfolios.
Following the analytical data from the end of May, about 2,000 BTC is withdrawn daily from centralized exchanges to cold wallets, this leads to the fact that bitcoin reserves on the exchanges have decreased to the April level.
In simple words, when there is a stage of bitcoin inflow to the exchanges, it signals its possible decline, which was observed at the time when the cost of the first cryptocurrency was in the range of $60,000 - $64,000. At a time when there is an outflow of bitcoin from exchanges, this signals the accumulation of the volume of the first currency by big players, as it already happened at the time of the recent upward cycle, where financial funds increased their portfolios.
Will the BTC outflow signal a new upward cycle this time around? Why not?
Cereal players are active
Just a few days ago, a message appeared on the website of the US Securities and Exchange Commission (SEC) that the American investment company Capital International Investors, which manages about $2.3 trillion, acquired 12.2% of shares in MicroStrategy, which has 105,085 BTC on its balance sheet.
In fact, Capital International Investors invested in the first cryptocurrency in this way in anticipation of its growth in the future.
It is worth recalling that MicroStrategy has been increasing the volume of bitcoin on its balance sheet for almost a year, attracting more and more new investors.
Purchase history:
August 2020: purchase of BTC for $250 million
December 2020: purchase of BTC for $650 million
February 2021: purchase of BTC for $1 billion
March 2021: purchase of BTC for $40 million
April 2021: purchase of BTC for $15 million
May 2021: purchase of BTC for $25 million
June 2021: purchase of BTC for $489 million
The positive news does not end there, the American holding company Fidelity Investments, which provides financial services, is increasing the staff in the division of the digital assets by 70% (+100 employees) due to the great interest in the new type of assets from institutional investors.
Fidelity Investments is considered one of the largest asset management companies in the world. Assets under management: USD 10.4 trillion.
There is much to say that cryptocurrency is a surrogate, an asset without a future and much more, and perhaps you will be right, but not only geeks and small market participants are interested in it. Banks, insurance companies, payment systems, corporations, and institutional investors take interest in cryptocurrency too.
In simple words, it is already impossible to simply ignore the cryptocurrency, and perhaps it is worth measuring up and getting to work.
What happens on Bitcoin and Ethereum trading charts?
I really want to tell you about strong price changes or drastic changes in market cycles, but, unfortunately, the market continues to follow a sideways course, as if preparing us for something truly grandiose.
Bitcoin, despite everything, continues to follow in the wide side channel of $30,000/$41,500, where the amplitude has shrunk to the boundaries of $30,000/$36,675 for about 2.5 weeks.
New frames can play the effect of a compressed spring for a new round of acceleration, but dramatic changes will occur after the break of the $30,000 or $41,500 marks.
Where should we go?
If you focus on the big players, then there is a prospect of a new upward cycle, but do not forget that these players view the investment as a long-term investment, not a short-term game.
Ethereum, unlike bitcoin, has characteristic price cycles, where, following the movement in the period of July 7-14, there is a weakening of the ETH rate.
Due to the clock component, a new area of interaction of trade forces was determined, these are coordinates $2,400/$2,450. A breakdown of this area will accelerate the movement towards the psychological level of $3,000.
The downward development will enter the active phase if the price is kept below the $1,700 mark.
