BTC correction: Small investors panic, smart money buying

Market is going down. Looking at fundamentals, there are only two important factors. The first and the most important one is the global stock market dynamics. We always try to picture crypto market as independent entity from “legacy” finance. The truth is BTC always stays in correlation with word economics. Stock market is already at bubble stage or at least really close to it. Everyone is waiting for US senate to decide on $1.8 trillion stimulus pack. Decision was delayed and there is no clarity if it will be approved. Approval and a fast execution will bring all markets up, delaying upcoming economic crisis. The second factor is BTC history chart. March is a bad month for BTC. Price is often goes down. A good number of investors and traders expect the pattern to repeat itself again.

Are BTC hodlers selling BTC at the moment? Look at the chart below:

BTC exchange balance hit a 2-year low. In other words, the supply of BTC is short. Usually, we can expect the price to rise in such occasions. This time the factors we discussed above stop mass investors from pushing the price up.

The next questions we should ask ourselves, what smart money are doing? Let’s look at the following chart:

IntoTheBlock tracks large transactions (> $100k USD) in BTC network. Institutional investors usually use this as an indicator. 7-day volume of large transactions hit 173 billions USD. This number shows large investors are interested in buying BTC at a good price. Another proof of this is the following chart from Coinbase:

Another 12k BTC were bought by an unknown investor today. In 2 weeks period it is the fourth transactions of this size. Previous transactions were around the price of $48k. This time an institutional investor was lucky to get BTC at around $46.7k.

It seems nothing really changes in crypto world. At any correction smart money buy BTC dropped by weak hands of small investors new to the market. Will we ever learn not to be crypto hamsters? What do you think of this correction? Let me know in the comments below!