Bitcoin Price News: Whales Are Dumping BTC at $60K – Should You Too?

Bitcoin (BTC) has recovered by 1.3% over the past 7 days, as the token has found strong support at $60,000 once again.

However, whales appear to be capitulating after months of accumulating the top crypto, as macroeconomic conditions have worsened.

Data from the CME FedWatch Survey indicates that analysts now expect a rate increase this year, as inflation in the United States is rising rapidly.

Inflation Rises and Pushes Sentiment Readings to Their Lowest Level in 3 Months

By the end of May, the Consumer Price Index (CPI) rose by 4.2%, meaning a 40bps increase compared to the month before.

Even though analysts were expecting this uptick, this confirmed the market’s concerns that President Donald Trump’s hostilities in the Middle East were going to have a negative impact on prices.

Higher energy prices are the main cause for these increased inflation levels. However, this affects the price of other goods as well as production costs increase across the board.

Investors have reacted negatively to this change in the macroeconomic landscape. Sentiment has soured to levels not seen in at least three months, as reflected by the Crypto Fear and Greed Index.

This gauge currently sits at 16, indicating that market participants are in “Extreme Fear” mode. Meanwhile, investors have been withdrawing money from Bitcoin-linked ETFs for weeks. According to data from Farside Investors, they have taken out over $160 million during the first couple of days of this week.

CoinShares Confirms the Market’s Focus on Interest Rates and Geopolitical Turmoil

In its latest report, published on June 5, analysts from CoinShares highlighted: “Sentiment has taken a clear turn for the worse over the past month. Across the last three weeks and the current week, we have seen US$5.8B of outflows from digital asset investment products — among the largest run of weekly outflows in well over a year.”

They also confirmed our view about the influence of geopolitical tensions and changes in the market’s expectations for interest rates in the latest price action.

“Two months ago the market was pricing one to two cuts this year, an environment that would have been supportive for Bitcoin. That has now flipped: the curve is implying roughly 40bps of hikes. This repricing is doing much of the damage to Bitcoin right now,” the report reads.

Meanwhile, on-chain data from Santiment shows that whale wallets holding between 1 and 10,000 BTC tokens have dumped 20,000 tokens during the first 10 days of June.

This implies a departure from the accumulation pattern we had witnessed in the past two months, and may further confirm that even the “smart money” is shifting gears.

BTC Bounced Off $60K But a Bearish Breakout Seems Highly Likely

Heading to the daily chart, we can see that Bitcoin just bounced off a key support at $60,000. This is the most relevant demand zone to watch in our view, as a break below could anticipate a much steeper drop ahead.

This mild recovery could still be considered a “dead cat bounce”, as the daily Relative Strength Index (RSI) just hit extreme oversold levels at 15.

We would need a much stronger rally off this demand zone to confirm that the downtrend is over, but macroeconomic conditions favor a bearish outlook in the near term.

Whales are dumping BTC, but not because they think it is expensive. They are probably selling because they know they will get to buy BTC at a lower price soon.