An investment analyst at OKEx exchange Robbie Liu holds the explanation that the current loss of investors’ interest in the asset is linked to the psychological battle between retail investors and whales.
Bitcoin, after grabbing headlines with its insane performance of getting near its previous All-Time High, has taken a reverse direction leaving late investors at loss. The BTC price has taken steps back on multiple occasions after reaching a trading price of $19,689 on November 30, 2020.The price from this point took a further step back to hover around the $18,300 price zone, recording $17,742 yesterday before obtaining a few gains to sit at the Bitcoin of $17,810. This is a bit surprising as several analysts predicted a “no turning back” situation for the market claiming the price would go straight to the moon. It is too early to call them out though as there is still a chance for the price to bounce back. At the time of writing, BTC is trading at $17,690.Some Possible Reasons for the BTC Price FallThe Head of Growth at Tokenlon, Lucas Huang made an interesting revelation as a possible reason for the recent pullback. According to him, there might have been a psychological battle between long term holders and short term holders of which the latter has won.BTC staging an 80% price growth within two months might have been seen as a perfect time to lock up assets to take out their profits. Interestingly, the contemplation to sell off holdings is not only linked to the short term investors but the long-term investors as well. Investors who have had their assets stored up for about 166 days and above have made a lot of profits and see this as the perfect time to cash out.An investment analyst at OKEx exchange, Robbie Liu holds the explanation that the current loss of investors’ interest in the asset is linked to the psychological battle between retail investors and whales.According to him, retail investors are uncertain whether to enter a new position starting from the point Bitcoin reached its yearly high. This has made the whales take advantage to become the sellers, and the direction of the next price movement will depend on who wins this battle.Nikolas Panigirtzoglou, an analyst, cites the inverse fractal of what happened between Bitcoin and gold about 4 months ago as the reason. In August, gold investors cashed out their profits when gold hit a top form to invest their profits in Bitcoin, causing the BTC price to record a market boom as gold fell by 11.5%.Investors might have repeated the cycle as they have reinvested in gold with the profits they made in Bitcoin, causing the price to suffer.“momentum signals have deteriorated, which will likely cause selling (of Bitcoin) by investors that trade on price trend,” he said.JPMorgan analysts still maintain that the BTC price will rise to the moon as it will revisit its bullish bias in the long term. The reason is that a lot of investors are selling off their gold to buy Bitcoin as they believe Bitcoin has just started. Bitcoin has enjoyed a lot at the expense of gold as money inflow has risen since October.next