It will not come as too big of a surprise to most, but more BTC is being sent to exchanges again. So far, that has no impact on the market momentum, as the overall NetFlow remains negative. Sustaining that momentum, however, will prove somewhat challenging.
BTC Netflow Remains Negative
The past week has been rather interesting for all cryptocurrencies. Numerous markets show a strong rebound after weeks of either sideways trading or slightly bearish pressure. That sudden turnaround took some people by surprise, although it is a welcome change. The momentum stands or falls with Bitcoin, which seems to reclaim $40,000 as a stable support level. There is still some volatility to contend with, however.
No one really knows what influences this market momentum these days, but hardly anyone will complain. A rising Bitcoin price is suitable for all crypto markets. Many investors will offer a sigh of relief after the past few turbulent months. There is still a big gap to overcome before prices go to where they were before the recent market dip, though.
Per Viewbase, the current Bitcoin Netflow looks relatively healthy. It is a negative number for the past day, and the past week looks even more bullish. Traders removed nearly 69,000 BTC from exchanges despite an ongoing increase in deposits. Someone – or groups of someones – are picking up any BC someone else drops on the way to $40,000, it would seem. Whether the momentum will stall there is unknown, but it doesn’t look like the case.
As the Bitcoin price nears $40,000, many traders will find themselves in a juxtaposition. Those who bought near $30,000 will have a good profit by now but might miss out on more if they sell too early. On the other hand, those who bought near $60,000 may take this opportunity to cut their losses before the market heads south again. The unpredictable nature of Bitcoin makes life exciting and decisions based on the overall netflow all the more difficult.
What Comes Next For BTC?
As the overall exchange netflow seems to be picking up, there will be some resistance before retaking $40,000. Bitcoin has surpassed that level multiple times in the past few days yet can’t sustain it for long. That situation may come to change shortly or remain the same for a few more weeks to come. It is impossible to draw real conclusions at this point as there are too many unknown factors.
Regarding the Bitcoin netflow, things remain rather interesting. An increase in funds moving to exchanges makes no difference now, as the overall volume is still reasonably low.
A new peak like the one in late May, however, may change the entire narrative. It is good to see people buying BTC from exchanges and moving it off these platforms right away. However, it remains unclear how many buyers there are and how long they can keep this up.