Disclaimer: The opinions expressed by our writers are their own and do not represent the views of U.Today. The financial and market information provided on U.Today is intended for informational purposes only. U.Today is not liable for any financial losses incurred while trading cryptocurrencies. Conduct your own research by contacting financial experts before making any investment decisions. We believe that all content is accurate as of the date of publication, but certain offers mentioned may no longer be available.
Bitcoin (BTC), the world’s leading digital currency, has left many investors anxious lately following its continued price resistance. In the past month, Bitcoin has swung between a low of $92,996 and a high of $108,036. Surprisingly, the coin has stayed below $100,000 within the past seven days, unable to hit new peaks.
Bitcoin accumulation trend points to bullish sentiment
However, CryptoQuant, a leading on-chain platform, has allayed concerns over Bitcoin’s performance. In a post shared with the broader crypto community, CryptoQuant noted that the coin is experiencing strong accumulation pressure.
Gamza KhanzadaevCryptoQuant, using Bitcoin’s 30-day moving average exchange inflow-to-outflow ratio as an indicator, shows that Bitcoin remains in high demand.
For context, the exchange inflow-to-outflow ratio compares the volume of Bitcoin deposited into exchanges against the amount being withdrawn. A ratio below 1 implies more Bitcoin is leaving exchanges and signals accumulation by investors.
This is a bullish signal as investors prefer to HODL their Bitcoin instead of selling.
Amid the price action of BTC, which appears to have stagnated between $92,000 and $105,000, the current ratio points to high outflows. This suggests strong demand and accumulation on the part of market participants.
According to CryptoQuant, history has shown that when this ratio reaches a high-demand zone, Bitcoin experiences a price increase in the short term.
Bitcoin’s current market position
The on-chain data platform, however, sounded a note of caution to investors.
Alex DovbnyaIt was noted that some registered outflows might not have been Bitcoin accumulation by retail traders or institutional investors. Rather, centralized exchanges will likely transfer assets to custodial wallets for exchange-traded funds (ETFs).
While CryptoQuant suggests that Bitcoin key metrics hint at a bullish signal, investors want to remain cautious in interpreting the signs.
As of this writing, Bitcoin price was changing hands at $96,738.02, representing a 0.23% decline in the past 24 hours. However, trading volume has increased by 50.95% to $23.35 billion as investors continue accumulating the coin.
Dan Burgin
Vladislav Sopov