Bitcoin Price Struggling: Can Bulls Absorb Increased Exchange Inflows?
There are concerns about Bitcoin’s ability to recover its strength, as one analyst predicts that the leading cryptocurrency may continue to register lower lows, indicating ongoing losses for the remainder of the week. The analyst, referring to data from CryptoQuant, highlighted the evolving age bands of Bitcoin transactions over the years and months.
- Analysts use age bands to categorize coins based on the last time they were moved on-chain.
- These bands indicate the increasing selling pressure on Bitcoin, according to the analyst.
Specifically, the analyst pointed out a significant movement of long-term holders’ coins to major exchanges like Coinbase and Binance, suggesting a bearish sentiment as holders may be looking to sell.
If more whales or large BTC holders continue to transfer their assets to exchanges, it could indicate an impending price crash, according to the analyst. The recent spike in coins transferred to exchanges coincides with price declines, signaling a potential delay in price recovery despite the maturing market.
Can Bitcoin Overcome Weakness? Inflows to Spot ETFs Are Crucial
The current downtrend in Bitcoin’s price raises questions about whether bullish investors will step in to counteract the recent selling pressure. Immediate support lies in the $60,000 to $63,000 range, and a recovery above this level could signal a potential uptrend for Bitcoin.
- Historically, the pace of price recovery depends on new inflows, especially from novice investors.
- The launch of spot Bitcoin ETFs in the US has disrupted this flow of capital into the crypto market.
According to an analyst, the recent price surge that briefly pushed Bitcoin over $72,000 was not driven by increased inflows from retail investors but rather by institutional players participating in spot ETFs. This trend suggests that institutional inflows now have a more significant impact on Bitcoin’s price movements.
As sentiment deteriorates due to falling prices, there could be more outflows from spot ETFs, intensifying the sell-off. Recent data shows significant outflows from Bitcoin ETFs in the US, indicating a potential shift in investor behavior.
Hot Take: Bitcoin’s Price Weakness Persists Amidst Bearish Pressure
Bitcoin is weak at spot rates, contracting from July 2024 peaks to below $66,000. As bears press on, targeting the round number at $60,000, bulls are optimistic, expecting a rebound in the coming sessions.
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