Bitcoin Whales Hold Steady: Key Indicator Points to Potential Market Shift as Binance CDD Hits 2017 Levels

Bitcoin Whales Hold Steady: Key Indicator Points to Potential Market Shift as Binance CDD Hits 2017 Levels

Bitcoin's price has dipped below the $91,000 mark following the Federal Reserve’s recent decision to reduce interest rates by 25 basis points. This move has caused some volatility in risk assets, resulting in a short-term bearish sentiment. However, on-chain data reveals a different narrative brewing beneath the surface.

Recent analysis from CryptoQuant indicates a significant drop in the Exchange Inflow Coin Days Destroyed (CDD) on Binance, which has fallen to 380—this is the lowest level since September 2017. CDD is a crucial metric for assessing long-term holder activity, giving a higher count to older coins that have been untouched for longer periods. When CDD values are low, it typically suggests that the Bitcoins being moved to exchanges are largely from short-term investors rather than long-term holders.

This data strongly indicates that seasoned investors, often referred to as "whales," are not selling their holdings, despite Bitcoin trading near its all-time highs.

Long-Term Holders Exhibit Strong Commitment

The decline in CDD becomes even more significant when we look at Bitcoin's price context. With BTC trading around $89,600, there is a noticeable disconnect between current price trends and the behavior of long-term holders.

Typically, when Bitcoin nears all-time high levels, older coins tend to be sold. This activity leads to spikes in CDD as early adopters and large investors cash out. Historically, elevated CDD readings signal market peaks.

Bitcoin Exchange Inflow CDD | Source: CryptoQuant

However, the current situation is quite different. Rather than seeing older coins being sold, the CDD metric is plummeting, suggesting that the BTC being deposited back onto Binance is not coming from long-term wallets. This indicates that smart investors are choosing to hold their assets, signaling confidence in the future of Bitcoin even after several months of downturns.

This lack of selling pressure effectively reduces available supply in the market, which can lead to bullish momentum in the future. In simpler terms, the whales are displaying faith in Bitcoin’s potential, defying short-term market uncertainties.

Bitcoin Price Action: Navigating Support Zones Amid Weak Momentum

Bitcoin's three-day chart shows that the market is stabilizing just above the $90,000 level following last week’s steep decline after the Federal Reserve's announcement. The price is currently contained between the 200-day moving average (red line), providing primary support, and the 100-day moving average (green line) above, which is limiting upward price swings. This creates a squeeze structure indicative of Bitcoin holding its ground but struggling to recover its previous trends.

BTC consolidates around key level | Source: BTCUSDT chart on TradingView

The candle formations illustrate a pattern of higher lows being established near the $89,000 to $90,000 range, indicating that buyers are attempting to protect this area as a temporary support. Nevertheless, the failure to move past the 100-day moving average emphasizes the ongoing bearish momentum, especially since Bitcoin has not recovered the critical breakdown point around $100,000.

Volume analysis also reveals that, although there has been a recent bounce in price, the strength of buying interest remains subdued. The rebound lacks an accompanying surge in demand, reflecting caution among market participants in light of the rate cuts and broader economic uncertainties.

If Bitcoin falls below the 200-day moving average, the next significant support could be found around $84,000, potentially initiating a deeper price correction. On the other hand, a decisive breakout above the 100-day moving average at approximately $98,000 would suggest a return of bullish momentum. For now, Bitcoin continues to move within a delicate consolidation phase with limited directional clarity.

Key Takeaways:

Bitcoin price has retraced below $91,000 amid interest rate cuts by the Federal Reserve.
The Exchange Inflow Coin Days Destroyed (CDD) metric has declined to its lowest level since 2017, indicating whales are holding rather than selling.
Long-term holders exhibit strong conviction, potentially signaling future bullish behavior despite current volatility.
Bitcoin is currently stabilized between key moving averages, with strong resistance around $100,000 and support at $90,000.