- Following the recent 15% loss in value of BTC in a couple of days, bitcoin miners have resumed large-scale accumulation. Yesterday saw the highest bitcoin outflow from crypto exchanges since September.
- On January 14, the DOGE price increased by more than 25% before correcting down to $0.1986 due to profit-taking.
Bitcoin miners shift their strategy
Miners' conduct in relation to their BTC holdings is critical for the general environment around the currency since they are the backbone of the Bitcoin network. Typically, they sell after a significant price increase to pay part of their electrical bills or just to achieve profits, and vice versa.
However, they have lately been hanging on to their bitcoin holdings. According to Glassnode on-chain statistics, the cryptocurrency's recent price drops, i.e. the decrease from $47,000 to sub-$40,000 levels, have only prompted miners to increase their holdings.
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Miners' accumulation has increased since the beginning of January, as seen in the figure above. As a consequence, their total balance surged in the same time period, setting a new annual high.
In addition to miners refusing to sell their BTC holdings, CryptoQuant data shows that investors have begun to withdraw large amounts of bitcoin from exchanges.
Yesterday, the daily withdrawals from major trading platforms were limited to 30,000 BTC. With today's pricing, this equates to about $1.3 trillion in USD.
This is the highest daily outflow from exchanges since late September. The asset's price was likewise on the decline at the time until it reversed course and started its October and November bull run, culminating in a new all-time high of $69,000.
Following the recent collapse below $40,000, bitcoin has responded effectively, recovering a few thousand dollars in a few days. Furthermore, the asset rose to $44,000 today as a result of news about the greatest inflation rates in the United States in the last 40 years. This marked the new weekly high for BTC.
Dogecoin (DOGE) skyrockets Elon Musk revealed Tesla will begin accepting it as payment for goods
The good news comes months after the billionaire entrepreneur said that DOGE was a better cryptocurrency to trade with than Bitcoin.
DOGE's price increased about 13% after the news, reaching a 30-day high of $0.2150. Its upward movement was part of a bigger intraday rise that was already underway before Musk's Dogecoin tweet got viral.
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Tesla's addition of a DOGE payment option to its online shopping site comes almost a month after Musk expressed his openness to accept the cryptocurrency as payment on a trial basis.
The "better-than-Bitcoin" attributes of DOGE were at the forefront of Musk's enthusiasm for it, mainly as a payment alternative because of its reduced power usage. In portions from his interviews with Time Magazine, Musk explained:
"Bitcoin, fundamentally, is not a suitable alternative for transactional cash." Despite the fact that it was founded as a MEME, Dogecoin is better suited for transactions."
In addition, the wealthy entrepreneur emphasized that Bitcoin has a high transaction cost while having a low transaction volume when compared to DOGE. As a consequence, Bitcoin may be well on its way to becoming a store of value asset. DOGE, on the other hand, may continue to encourage consumers to spend.
What is the future of DOGE?
The most recent wave of purchasing in the Dogecoin market has waned as DOGE tests a multi-month resistance trendline for a topside breakthrough.
In particular, the DOGE price surge was slammed into a declining trendline resistance that has been stymieing its upward movement since May 2021. As demonstrated in the chart below, on January 14, the trendline once again had a role in dropping DOGE from its intraday high of $0.2150 to $0.1958.
Meanwhile, the Dogecoin's 200-day exponential moving average (200-day EMA; the orange wave) played an important role in restraining its advances on Jan. 14. The resistance confluence suggested that the DOGE price may fall back from its current rise in the next sessions.
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If this occurs, the token seems to be prepared to test its 50-day EMA (the velvet wave) as support, with the potential to extend its decline towards $0.1367 owing to its recent history as support.
