Recent on chain data suggests the latest dip in Bitcoin may not be over as large holders reduce their positions while smaller investors continue accumulating. Market analysts say this divergence between whales and retail traders has historically appeared before deeper corrections.
According to data from Santiment, wallets holding between 10 and 10,000 BTC aggressively accumulated during the market sell-off between Feb. 23 and March 3, when Bitcoin traded between $62,900 and $69,600. The buying activity occurred during heightened geopolitical tension linked to the Iran conflict sell-off that triggered a sharp decline across crypto markets.
However, when Bitcoin rebounded and approached $74,000 on March 5, those same wallets began taking profits. Data indicates that these large holders have already sold roughly 66% of the coins they accumulated during the downturn.
Retail Investors Continue Accumulating Bitcoin
While large investors reduced exposure, smaller wallets have continued buying the dip. Wallets holding less than 0.01 BTC increased their holdings as Bitcoin slipped back below $70,000.
Analysts say this pattern retail investors buying while whales sell often signals that the market correction may still be in progress. Historically, major holders tend to distribute assets during short-term rallies, leaving retail traders to absorb the supply.
Market Sentiment Remains in Extreme Fear
Additional data from Glassnode shows that roughly 43% of the total Bitcoin supply is currently held at a loss. This creates additional selling pressure when prices recover, as investors attempt to exit positions near their break-even levels.
Meanwhile, the Crypto Fear and Greed Index dropped to 12, placing sentiment firmly in the “extreme fear” zone. Analysts say the market now faces a critical point where Bitcoin could either break above the $74,000 resistance or fall further toward the $60,000 support level.
Disclaimer
This content is for informational purposes only and does not constitute financial, investment, or legal advice. Cryptocurrency trading involves risk and may result in financial loss.