Bitcoin Rally Accompanied By ‘Very Bullish’ Whale-Retail Behavior, Santiment Says

[Ben Graham]

On-chain analytics firm Santiment has revealed how Bitcoin is currently in a bullish zone based on the behavior of whale and retail investors.

Bitcoin Major & Retail Entities Have Shown Opposite Trajectories Recently

In a new post on X, Santiment has talked about how Bitcoin investor behavior currently compares between the top and low ends. Sharks and whales make up for the former category, while retail investors represent the latter. Formally, the wallet ranges of the two sides of the market are defined as 10 to 10,000 BTC and less than 0.01 BTC. Below is the chart shared by Santiment that shows the trend in the Bitcoin supply held by each of these cohorts over the last few months.

As is visible in the graph, the Bitcoin sharks and whales have seen their combined supply rise during the last few days, indicating that the large investors have been accumulating. Meanwhile, the retail investors have sold instead. This could imply that the big-money hands are backing the latest price rally, while small holders don’t believe the run will last, so they are exiting with their profits. If history is to go by, this may actually be a positive signal.

According to the analytics firm, whale and retail behavior diverging in this manner puts the market in what it defines as the “Very Bullish” zone. “This is the ideal setup for a bull run,” noted Santiment.

In the chart, the analytics firm has also highlighted four other zones for BTC based on the trajectories followed by the whale and retail supplies. “Very Bearish” (colored in red) follows the same contrarian logic as the Very Bullish region, with the zone appearing when large entities are selling, and retail is accumulating. Bearish (orange), Neutral (yellow), and Bullish (blue) map out the spectrum between the two extreme regions.

Bitcoin’s latest venture into the green Very Bullish zone has come as sharks and whales have loaded up on 32,693 BTC (worth about $3.1 billion) since January 10th, corresponding to a supply increase of 0.24%. Retail investors have sold 149 BTC ($14.4 million) in this window instead, equivalent to a drop of 0.30%.

It now remains to be seen whether BTC will stay in this region for long or if another shift in investor behavior will take place. “How long it lasts depends on how long retail doubts the mini rally that has formed,” explains Santiment.

BTC Price

Bitcoin witnessed a break beyond the $97,000 level on Wednesday, but the bullish momentum has since cooled, with the BTC price returning to the $96,900 mark.