After weeks of fluctuating performance, Bitcoin is once again in the spotlight as on-chain data highlights critical trends emerging from Binance, the world’s largest cryptocurrency exchange.
The latest insight reveals that there has been an interesting move in Binance’s Netflow Simple Moving Average (SMA14), a key indicator often associated with shifts in Bitcoin’s short-term price direction.
Historically, this metric has provided reliable signals regarding the platform’s investor sentiment and accumulation behavior.
Binance Netflow Data Signals Accumulation Phase
A recent analysis by a CryptoQuant analyst, Burak Kesmeci, sheds light on Binance’s Netflow data from the past 90 days. According to Kesmeci, whenever the Netflow SMA14 moves into positive territory, Bitcoin tends to face short-term selling pressure, leading to temporary corrections.
Conversely, when this indicator turns negative, it suggests a shift in investor sentiment toward accumulation, potentially signaling a short-term bullish trend.
On January 6, 2025, Binance’s Netflow metrics revealed some notable insights. The Netflow on Binance recorded a value of -5,407 BTC, while the 14-day Simple Moving Average (SMA14) for Netflow stood at -483 BTC.
These negative readings indicate that more Bitcoin is leaving the exchange than entering it, a behavior commonly associated with investor accumulation.
Binance Netflow SMA14 Turns Negative
“Both metrics confirm that investor behavior on Binance is leaning toward accumulation. This trend strongly supports the case for upward movement in Bitcoin’s price over the short term.” – By @burak_kesmeci
Link
https://t.co/jSkRZ2TjLk pic.twitter.com/Rau37VjBQN
— CryptoQuant.com (@cryptoquant_com) January 7, 2025
Historically, such trends have acted as early indicators of potential upward price movement, as reduced Bitcoin availability on exchanges reduces immediate selling pressure.
When Bitcoin holders move their assets off exchanges, it usually signals their intent to hold long-term rather than sell. This pattern of behavior contributes to a supply squeeze scenario, where lower liquidity on trading platforms creates upward price pressure.
The fact that Binance is the largest cryptocurrency exchange by trading volume gives this indication more credibility as the platform often serves as a barometer for broader market sentiment. Kesmeci concluded:
In summary, both metrics confirm that investor behavior on Binance is leaning toward accumulation. This trend strongly supports the case for upward movement in Bitcoin’s price over the short term.
Bitcoin Market Performance
Bitcoin’s bullish momentum appears to be losing steam, as recent price action shows limited strength to sustain a rally. Just 24 hours ago, Bitcoin was trading above $102,000 after a 4% uptick. However, the asset has since retreated, erasing most of those gains and stabilizing just above the $100,000 threshold.
At the time of writing, Bitcoin is priced at $100,630, reflecting a modest 1.3% increase over the past day. Despite this slight uptick, the asset remains approximately 7% below its all-time high of $108,135, recorded last month.
Featured image created with DALL-E, Chart from TradingView