Bitcoin prices are on the rise again, up 3.2% in the past 24 hours, leading a broader 3.7% rise across the cryptocurrency market. It has risen about 5% in the past month, showing that it is gradually gaining momentum.
But the rise is not without signs of hesitation. Although the overall picture remains bullish, two undervalued but important indicators are changing behind the scenes that could slow the next leg up.
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Whales withdraw from foreign exchange outflow mitigation
One important factor to look at is the behavior of the whales. Whales are large holders, typically holding wallets of 1,000 BTC or more, and their activity often indicates the direction of the market.
Data shows that the whale population has declined to a three-month low of 1,350 whales since October 14th, and the first decline from the local high on October 14th occurred around the time Bitcoin prices corrected from $115,000 to $106,400. A decline of 7.40%.
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This indicates that some large holders are taking profits. As a result, much of the current purchasing appears to be driven by small individual participants rather than institutional-sized players.
A related indicator, change in exchange net positions, complements this view. Measures how many Bitcoins enter and leave an exchange each day. A negative value means an outflow (buy) and a positive value means an inflow (sell).
On October 15th, the outflow amount reached 111,720 BTC, indicating strong buying pressure. By October 26th, they had fallen to 54,643 BTC, a decline of approximately 51%.
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Outflows still suggest accumulation, but a slowdown suggests buying momentum is fading, potentially leading to a return to short-term selling before the next uptrend.
Bullish divergence holds, but Bitcoin price tests resistance
At the same time, the Relative Strength Index (RSI), a tool that measures buy and sell strength, continues to support a broadly bullish view. The indicator has been forming higher lows since mid-October, despite the temporary decline in prices, creating a so-called bullish divergence.
This usually means that the seller has lost control and the buyer is slowly coming back.
The RSI trend ties in nicely with the current chart pattern. Bitcoin has now confirmed the breakout of its descending wedge, with the price moving above $111,000 and hovering near $114,900.
If the daily candlestick closes above $117,600 (a significant resistance level), the next resistance levels could be $121,400 and $126,300, with a potential target near the new all-time high zone of $134,100. This is a 20% increase from the breakout level of $111,000.
However, if Bitcoin fails to sustain above $112,200, a deeper pullback could ensue. A fall below $108,900 (6% down from current levels) could result in a $103,500 risk. This is a level that previously served as a strong support.
