Bitcoin’s rise above $ 19,500 was cut short early Tuesday, possibly due to taking profits from major Asian investors, according to one analyst.
The highest cryptocurrency fell from $ 19,555 to $ 19,035, with most of the fall developing in the two hours to 06:00 UTC, according to CoinDesk 20 data.
“I think Asian whales have sold around $ 19,500 causing prices to fall,” Ki Young Ju, CEO of South Korean blockchain analytics firm CryptoQuant, told CoinDesk, referring to those with large crypto holdings . He highlighted a growing inflow of coins on Huobi Global’s heavyweight crypto exchange, which has a presence in Hong Kong, just before prices began to fall.
“A total of 2,013 coins were transferred to Huobi in blocks of 661,425 to 661,430 just 15 minutes before the price fall,” said Ju, adding that block number 661,425 carried 1,017 coins, the highest single block inflow on Huobi since November 30.
On Monday, Huobi’s total of 8,836 BTCs reached, with a mean transaction of 4.5 BTC, the highest since March 2018, according to CryptoQuant.
The increase in the average size of exchange deposits shows that larger investors were transferring their coins to Huobi and may have liquidated their holdings by about $ 19,500, a level that has acted as a stiff resistance of late.
Bitcoin has failed several times to establish a foothold above that point since Nov. 25, which is believed to be largely due to some investors ordering profits on fears it will sell out in the near-term.
At press time, bitcoin has rebounded to nearly $ 19,300 and the path of least resistance for the cryptocurrency remains to the higher side, according to analysts.
The options market sees a 35% probability of bitcoin ending in December above $ 20,000, according to a Skew data source. That’s significantly higher than the single-digit probability seen three months ago when bitcoin was trading near $ 10,000. Some investors appear to have purchased $ 20,000 strike price call options on Monday.
Skim data shows the open interest or number of open positions in the bullish $ 20,000 call raised 1,054 contracts on Deribit, the world’s largest crypto options exchange by volume and open interest.
However, forcing a cut above $ 20,000 in the short term could be a task up for the bulls, as sizable sales orders are open in the approach of a record high spot price ever.
Also read: How One Trader Turned $ 638K Bitcoin Options Into $ 4.4M In 5 Weeks
“There are still offers over $ 19,500 up to $ 20,000,” Patrick Heusser, head of trading at Crypto Broker AG in Zurich, told CoinDesk. “The US cryptocurrency exchange Coinbase shows 700 bitcoin for sale at $ 20,000, but every other exchange shows some offers up there as well around 200-300 coins.”