On-chain analysis shows that Bitcoin foreign exchange reserves have fallen off the cliff. This behavior is usually a bullish indicator of the BTC market.
Bitcoin reserves drop across all exchanges
As CryptoQuant pointed out postal, The reserve indicators of all BTC exchanges have fallen sharply in the past few days.
Bitcoin all exchange reserves is an indicator that shows the amount of BTC stored in all exchange wallets. When the value of the indicator rises, it means more investors send their cryptocurrency to the exchange.
More BTC on the exchange means selling pressure. On the other hand, when its value drops, it means that investors are sending their coins from exchange wallets to personal wallets.
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This is a chart showing the value trend of all exchange reserves of BTC in the past two months:
The BTC all exchanges reserve seems to have steeply declined | Source: CryptoQuant
As shown in the figure above, the indicator drops at a rather steep slope. Just in the past two days, the value of this indicator has dropped by more than 100,000 bitcoins!
Since the decline in the value of this indicator means that more BTC is withdrawn from the exchange, this may mean that there is buying pressure in the market. Prices should be positively affected.
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Looking at the outflow charts of popular exchanges shows huge volatility. Coinbase Pro saw 30k BTC exit the platform on Wednesday, while Binance, the most traded exchange, saw approximately 29k BTC flow out of its wallet.
some days ago, Binance observes huge net trafficThe price has since changed positively, so the plunge in reserves on all exchanges may cause the price to rise this time.
At the time of writing, Bitcoin price The stock price floats around US$39,800 and has risen by 24% in the past 7 days. In the past month, the value of cryptocurrencies has risen by nearly 15%.
This is a chart showing the price trend of BTC over the past 3 months:
BTC catches a sharp upwards trend | Source: BTCUSD on TradingView
After struggling for a long time in a range-bound market, Bitcoin finally recovered some volatility. The rapid price fluctuations of US$34,500 to US$39,500 were accompanied by The biggest short squeeze in token history Because short sellers are eager to reduce their losses.
The cryptocurrency is now testing the resistance level of $40,000. If it can maintain a rebound and push, it is very likely coin Will reach the 45,000 U.S. dollar mark. However, if this level cannot be exceeded, BTC may fall back to a range-bound market.