This week Bitcoin hit $122,000 after soaring more than 300% from its lowest points. But as massive whale activity sets off a wave of selling pressure, the initial euphoria has swiftly given way to caution. On the daily chart, Bitcoin made a strong volume-driven breakout above the resistance zone between $112,000 and $114,000.
Every major moving average, including the 50-day EMA at $107,800 and the 200-day EMA at $97,000, was well above the price. There should have been solid bullish momentum following this textbook breakout. Rather, it is now encountering fundamental headwinds. In particular, the whale responsible for the notorious 80,000 BTC wallet has begun transferring funds to Galaxy Digital, an OTC desk.
A total of 16,843 Bitcoin, or about $2 billion, is currently being prepared for sale. Even before the majority of this liquidity reached the market, the mere act of moving coins caused a dramatic reaction: spot exchanges saw a rush of defensive selling and Bitcoin‘s price instantly fell by more than $6,000 per coin. This is the issue with the low-float rally dynamics of Bitcoin: volatility increases and liquidity quickly evaporates when big holders choose to cash out.
There were panic-driven exits in anticipation of this whale distribution, which contributed to the 300% increase in daily trading volume that was observed during the move. Technically speaking Bitcoin is still above short-term support at about $111,000 per day. However, buyers are stepping away in real time, as indicated by the reversal near $122,000. Should Galaxy Digital begin to execute the entire sales tranche, the subsequent leg down could potentially test the $107,000-$110,000 range.
Although the long-term upward trend of Bitcoin remains intact, swift reversals are more than possible, and weeks of consistent accumulation can be overtaken by a single large seller. As the market processes this $2 billion in liquidation, traders should keep an eye out for additional whale movements and brace themselves for more explosive swings.
Ethereum pushed down
Although Ethereum‘s break above $3,000 appeared encouraging on paper, but things are turning out to be less pleasant in practice. Less than 24 hours after breaking through this crucial psychological barrier, ETH has since fallen back beneath it, currently trading at about $2,980. Bulls have not gained traction above $3,000, as evidenced by this quick reversal.
The story is clearly seen on the daily chart: following a significant upward push from the $2,600-$2,800 range, ETH produced a few candles on high volume before facing immediate selling pressure.
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The inability to sustain altitude and the rejection wick suggest that traders are eager to lock in profits and that their buying impulse is worn out. The wider market context aggravates the issue. When Ethereum tried to break out, Bitcoin pulled back several thousand dollars, demonstrating how its volatility has been affecting ETH sentiment. Every intraday dip has been exacerbated by this correlation drag and overbought conditions (the RSI is close to 70).
Since ETH is still technically above all of the major moving averages, the long-term structure is still in place. Both the 200-day EMA at $2,474 and the 50-day EMA at $2,587 are significantly below the current price and serve as buffers against more significant corrections. This inability to hold $3,000, however, is a warning indication that momentum may revert to the $2,800 consolidation zone if buyers do not reorganize quickly.
Ethereum must retest and conclusively close above $3,000 with high volume in order to sustain the uptrend, something it was unable to do on its first try.
Shiba Inu denied
With one of the most outrageous fakeouts in recent trading history, Shiba Inu has left traders wondering if the price action was real or if it was purposefully designed to catch late buyers. In what appeared to be a promising breakout attempt over the past week, SHIB rallied into the crucial resistance zone close to the 200-day EMA (the black line on the chart).
But the rally nearly immediately stalled out, rather than confirming a trend reversal. A major warning sign, from a technical standpoint, is the inability to close above the 200 EMA. Since the beginning of January, this level has served as a ceiling halting all attempts at rallies and bringing bullish sentiment back to its starting point.
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The price made a brief break through the $0.000013 zone on this most recent attempt, but it quickly reversed on rising volume, which is a classic sign of distribution rather than accumulation. There is a telling pattern here. For weeks, SHIB was consolidating in a narrow range between $0.000011 and $0.0000125.
The unexpected spike enticed those who had been sidelined to join in, believing a bigger breakout was about to happen. The move now appears suspiciously like a liquidity grab intended to increase exit liquidity for larger holders, as there was no follow-through buying and an instant rejection. The result is obvious: confidence in a sustained reversal is lost and momentum is destroyed.
Once again, the price is hovering close to previous support levels as the RSI has pulled back from overbought readings. A deeper retracement toward $0.000011 – or worse – is likely if SHIB is unable to maintain above $0.0000122 in the upcoming days. In other words, there is no reason to think that this was anything other than a well-timed fakeout in the absence of a confirmed break and hold above the 200 EMA. There is very little chance that Shiba Inu will see a significant reversal unless there is an unanticipated spike in actual buying volume.
