According to CryptoQuant's J. A. Maartunn, the price of Bitcoin, the largest cryptocurrency by market cap, might soon experience a bounce.
His assessment is based on the Net Taker Volume indicator, which measures the difference between selling and buying volume on Bitcoin futures volume.
The metric, which was introduced earlier this year by CryptoQuant, helped to identify the cryptocurrency's tops and bottoms during the previous market cycle.
The indicator flashes a major bearish signal when it is deep in the negative territory after a substantial price rally. This indicates that the market is potentially facing heavy selling pressure. Hence, in such a case, a major correction is likely on the cards.
However, if the Net Taker Volume remains in the positive territory despite a price decline, this means that the market has likely bottomed.
Maartunn believes that the second scenario could be possibly unfolding right now, which is why the Bitcoin price might experience a relief rally in the future.
At press time, the largest cryptocurrency is changing hands at $66,276 after dipping to as low as $64,673 earlier this Wednesday. The leading cryptocurrency is valued at $66,276.
According to CoinGlass data, $239.32 million worth of crypto has been liquidated over the past 24 hours, with longs accounting for the majority of the wipeout ($149 million).
As reported by U.Today, Bitcoin recently recorded its seventh consecutive month in the green for the first time in roughly 12 years. However, it is so far struggling to regain momentum this April largely due to underwhelming ETF flows. On Tuesday, Ark's Bitcoin ETF surpassed Grayscale's GBTC in total inflows.