Bitcoin price has been hovering around $23,000 for over two months. However, in the past few days, the flagship currency reclaimed the $24,000 level in a move not seen since May.
For now, however, bitcoin has slipped below $24,000 to trade at $23,965 with a 2.04% drop in the last 24 hours.
Amid growing hopes of a bull run in BTC, an on-chain analytics firm — CryptoQuant — claims the asset is still under bearish scrutiny.
According to reports, the exchange inflow trend needs to change soon for Bitcoin to see a change in market trend. Today, CryptoQuant’s weekly Bitcoin Highlights revealed that while Bitcoin saw an overall crypto market rally on Wednesday, August 10, it may have been trading on a bearish note following the release of US CPI prices
The analytics firm further explained the Exchange Inflow Spent Output value bands, which reveal the value of bitcoin addresses registered on the exchange. This figure is used to understand the larger amount of bitcoin addresses that went public shortly after the inflation date was announced.
According to the company’s Aug. 10 survey, the flow of bitcoins to exchanges from holders of 1,000 to 10,000 BTC has seen a massive spike.
CPI Effect on Bitcoin Price
Consumer Price Index (CPI) data was released on August 10 showing that inflation fell to 8.5% in July from 9.1% in June. This impacted the financial market as crypto and stocks soared and Bitcoin and Ethereum saw an uptrend to 60-day highs. Here Bitcoin closed the day at $25,000 and Ethereum just above $1,900.
Now, market participants are optimistic that the Federal Reserve will not continue its said rate hikes as the inflation rate falls. The collapse in inflation will also contain the recession and propel the global economy towards better days. However, the macroeconomic concerns have yet to be resolved.
According to CryptoQuant research, Bitcoin needs to move from cash exchanges like Coinbase to derivatives exchanges to exit the market correction, which will be important to gauge attitudes towards market risk, meaning investors are willing to invest with leverage or Bitcoin as collateral to be used for other activities.
Although the CryptoQuant data suggests that the crypto market, especially Bitcoin, is still under bear control, many experts and analysts think it won’t stay that way for long.
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