Bitcoin price eyes $65K breakout as BTC exchange reserves fall to 2018 lows

Bitcoins (BTC) ongoing price rally above $64,000 has coincided with a substantial drop in its reserves across all exchanges.

According to data provided by CryptoQuant a South Korea-based blockchain analytics service the amount of Bitcoin held in exchanges wallets dropped to as low as 2.379 million BTC earlier this week, the lowest in more than three years. Currently, the reserves are around 2.38 million BTC.

Bitcoin reserves across all exchanges. Source: CryptoQuant

CryptoQuant noted that the declining Bitcoin reserves showed the availability of fewer BTC tokens for selling, altcoins purchasing, and margin trading. Additionally, that also reflected traders intention to hodlthe cryptocurrency.

Demand for Bitcoin grows among whales and fishes

On the other hand, the cryptocurrencys demand appears to have been increasing across retail and institutional traders, with the number of wallets holding more than $100 and $10 million worth of BTC reaching their record high of 16.67 million and 10,510, respectively.

Bitcoin addresses with balance greater than $100 and $10 million. Source: Messari, Coin Metrics

On-chain analyst Willy Woo published areport in August 2021 that discussed Bitcoins supply shock against its rising demand, concluding that the cryptocurrencys per-token worth should be at least $55,000.

The conservative target remained lower than pseudonymous analyst PlanBs $135,000 price projection by the end of 2021, based on his stock-to-flow model.

Meanwhile, PlanBs Bitcoin price prediction for November 2021 sits around $98,000, above $70,000, the most preferred strike target for the options expiring on Nov. 26, as shown in the chart below.

BTC options OI by strike price (expiry Nov. 26, 2021). Source: Bybt

BTC price macro fundamentals

Bitcoins bullish on-chain fundamentals are likely to see further strength from Wall Street adoption.

On Tuesday, ProShares became the first exchange-traded product firm to launch a Bitcoin futures-based exchange-traded fund (ETF) on the New York Stock Exchange. In a milestone for Bitcoin investing opportunities, the listing opened a new road for institutional investors to gain exposure to BTC.

For instance, FundstratGlobal Advisors co-founder Tom Lee said he anticipated Bitcoin ETFs to attract at least $50 billion in the coming 12 months, reasserting his teams year-end $100,000 price target for BTC.

Technically, Bitcoin appeared to be heading toward its record high near $65,000, now acting as a resistance level.

BTC/USD daily price chart featuring Fibonacci retracement levels. Source: TradingView

On the flip side, Bitcoins relative strength index (RSI), a momentum indicator that analyzes an assets overbought/oversold signals, reported the cryptocurrency price as excessively high on the daily candle chart, suggesting that a pullback is on the table.

Related:Bitcoin sees its highest ever daily close as BTC/Euro pair hits all-time highs

Should a correction happen, Bitcoins next support target could be near $57,500, which serves as the 78.6% Fib level of the Fibonacci retracement graph, drawn between the $65,000 swing high and the $30,000 swing low.

The level also coincides with Bitcoins 20-day exponential moving average (the green wave in the chart above). The said level has earlier acted as strong support during Bitcoins uptrend.

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