Lately, Bitcoin's (BTC) biggest investors have been upping their reserves in sync with the ongoing cost recovery, i Glassnode metric suggests.

Dubbed as the "Whale Supply Shock," the on-chain indicator represents the ratio between the amount of Bitcoin held by "whales" and "fishes." Whales stand for addresses that hold betwixt ten,000 and 100,000 BTC, while fishes are those that agree anything between 0.001 and one,000 BTC.

A rising Whale Supply Shock reading indicates a higher degree of accumulation by whales versus fishes. Conversely, a failing Whale Supply Shock shows fishes are accumulating Bitcoin at a faster pace than whales.

BTC Whales Supply Stupor versus price. Source: Glassnode

That said, the Whale Supply Shock tends to provide "a measurement of supply locked in Whales wallets which tin can have [issue] on supply dynamics and thus on price," stated Dor Shahar, an on-chain analyst at CryptoJungle, in a tweet on Nov. 1.

BTC price correlation with whale action

The Whale Supply Shock appeared to have been predicting the macro Bitcoin price tops. For case, the BTC price topped at near $65,000 in Apr, two months after the supply held by whales reached a sessional tiptop.

The metric showed that whales began distributing their coins amid fishes, correctly predicting an upcoming macro pinnacle and correction. As a result, the Whale Supply Shock dropped, equally shown in the nautical chart below.

BTC Whales Supply Shock recovers in tandem with toll. Source: Glassnode

It started recovering afterwards bottoming out in mid-July, indicating that whales started re-accumulating Bitcoin at a faster pace than the fishes. That coincided with Bitcoin rebounding from around $30,000 on July 20 to eventually reach a new tape high of $67,000 three months later.

The correlation was besides visible around Feb 2022, noted Shahar who also stated that whales began distributing their BTC "right before the ATH," calculation:

"Same phenomenon happened at May of 2022, whales have accumulated up to a certain signal where the supply held by them reached a peak. Once again, correct before the macro top they began to distribute coins."
BTC Whales Supply Shock peaks ahead of its spot cost top in May 2022 . Source: Glassnode

Shahar cited the said nautical chart fractals and ruled out the ongoing recovery in the Whales Supply Shock ratio as a sign of "a multi-month accumulation uptrend." He besides noted that the supply held past whales in October, when Bitcoin's price was effectually $62,000, is much smaller than information technology was in Apr, saying:

"[It] might point accumulation menstruum or a by and large depleting supply held by whales."

Bitcoin technically bullish

Shahar's bullish outlook for the Bitcoin market place appeared as the cryptocurrency recovered from under $lx,000 to centre a retest of its record high at around $67,000.

Related: 'Uptober' closes at tape high in all-time month of 2022 — five things to lookout in Bitcoin this calendar week

In doing so, BTC price appeared to have been forming a classic bullish continuation pattern chosen the "Bull Flag." That said, the price looks poised to pause out of its ongoing consolidation range and rising by every bit much equally the previous uptrend's tiptop, also known as "Flagpole."

BTC/USD daily cost chart featuring potential Bull Flag setup. Source: TradingView

The Bull Flag's turn a profit target comes to exist above $70,000.

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