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A Bitcoin ATH in the making? – Here’s why KEY data suggests…

2min Read

A 40% decrease in coins flowing to exchanges, according to the flow multiple, showed decreased short-term inflows and implied exhausted sellers.

A new Bitcoin all-time high could be brewing, here are the signs that support this
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  • Bitcoin’s difference in liquidity highlighted increased buying power in the market.
  • Lowered BTC inflows to exchanges over the past month hinted that sellers were exhausted.

Bitcoin [BTC] witnessed subdued on-chain activity, though it faced increasing corporate demand. This created a striking divergence between the price action and network metrics.

Miner outflows were below average, which has historically signaled miners’ confidence in a price appreciation. The Coin Days Destroyed metric noted no panic amongst long-term holders, another sign of confidence amongst seasoned holders.

On the other hand, aggressive buying was cooling off, as the falling Taker Buy/Sell Ratio reflected.

The rising spot BTC ETF inflows, combined with the conviction highlighted earlier, might be enough to drive a sharp impulse move and a new all-time high for Bitcoin.

Other metrics supported the bullish argument for Bitcoin.

How Bitcoin’s different liquidity zones could spark the next price jump

An increase in market buying power, combined with signs of seller exhaustion, could be setting the stage for Bitcoin’s next rally. 

According to crypto analyst Axel Adler Jr., the Difference Liquidity metric, which tracks changes in available buying power based on Bitcoin and stablecoin inflows to exchanges, has turned negative on its 30-day Moving Average. 

This places it in the chart’s “demand generation” zone, highlighted in blue, which historically signals strong and sustained Bitcoin accumulation.

The last time this level of demand shift occurred was during the market recovery following the Terra/LUNA collapse in May 2022.

 If stablecoin inflows to exchanges now match or exceed those seen after the LUNA crash or the FTX implosion in November 2022, Bitcoin could be poised for a sharp upward move.

The Bitcoin Exchange Flow Multiple compares the past 30 days of BTC inflows to their 365-day moving average. 

Over the last two weeks, this metric has dropped from 1.0x to 0.6x—a 40% decline, indicating a significant reduction in the number of coins being sent to exchanges.

The last time such a sustained drop occurred was in April 2023. 

Historically, low exchange flow multiples like this have often preceded strong price rallies, suggesting a potentially bullish outlook for Bitcoin.

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Akashnath S is a Senior Journalist and Technical Analysis expert at AMBCrypto. He specializes in dissecting price action, identifying key market trends through advanced chart patterns, and forecasting both short-term and long-term asset trajectories. His distinct analytical method is grounded in his academic training as a Chemical Engineer. This background provides him with a systematic, process-oriented approach to market data, enabling him to analyze the complex dynamics of financial markets with precision and objectivity. Having actively covered the cryptocurrency space since the landmark 2017 market cycle, Akashnath possesses years of experience navigating both bull and bear markets. This seasoned perspective is critical to his insightful reporting on market volatility and evolution. As an active market participant, Akashnath enhances his analysis with crucial, hands-on experience. This practical application of his technical skills ensures his insights are not merely theoretical, but are also relevant and actionable for an audience looking to understand and navigate trading opportunities. He is dedicated to educating readers on the nuances of technical analysis, empowering them with the knowledge to make more informed financial decisions.
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