NewsBTC
Bitcoin exchange inventory level is a good way to gauge market sentiment towards the cryptocurrency. Inflows to exchanges in the past have usually indicated strong sell sentiment. Stemming from investors wanting to cash out the profits that they have made. This is usually the case during bull markets when prices go up. But for the first time, bitcoin exchange inventory levels are declining even though the price of the digital asset is on the rise.
Related Reading | Hot Bitcoin Summer. But Why Altcoins Are On The Rebound
Numbers show that bitcoin exchange levels are not rising according to the price. If anything, the inverse looks to be the case. The number of bitcoins leaving exchanges recently has risen sharply. Just in the past 30 days, over 100,000 bitcoins have flowed out of exchanges. Representing one of the sharpest exchange reserves decline in the market.
BTC exchange reserves experience sharp downtrend | Source: Twitter
Investors Are Accumulating
The number represents a decreased supply in the market, and the outflows indicate that demand for the digital asset is on the rise. Investors are holding on to their coins instead of moving the coins to exchanges to sell. This has now put a lot of buy pressure on the market. The decreased supply will inadvertently lead to an increase in the price of the digital asset.
BTC exchange reserves fall for the first time in a bull market | Source: Twitter
These patterns show a peculiar accumulation pattern in the market. Bitcoin accumulation is usually highest when the market is in a bear market. An extended bear market like the one following the 2017-2018 bull market would see investors hoarding coins in wait for the next bull. But presently, accumulation patterns show that investors are hoarding coins even in a bull market.
Sentiment remains generally positive with the Fear & Greed Index finally moving into greed for the first time in months. Accumulation patterns now show a very bullish pattern in the market. Retail investors do not think that the bull market will be over anytime soon, neither do the institutional investors.
Related Reading | Bullish Signal That Resulted In A 250% Increase In Bitcoin Is Getting Triggered Again
As more bitcoins are mined, leading to the decline in the number of bitcoins left to come into the market, investors are trying to get their hands on as much of the digital asset as possible. This increased demand is what has sent the price surging. Leading to a continuation of the bull market that had grinder to a half after the asset hit a new all-time high of $64K.
Bitcoin Moving Up With Accumulation
Bitcoin’s price has been on the up and up going into August. Its price had hit $45K for the first time in two months, pointing to a continuation of the bull market. Eight consecutive green days had seen BTC hit eight green candles, triggering a bull run in the market. At this point, bulls had taken complete control of the market. Bears had recorded massive losses as the market saw over $1 billion shorts liquidated in the span of 24 hours.
BTC price trailing $44K | Source: BTCUSD on TradingView.com
The bulls have continued to maintain their hold on the market. Bitcoin price has experienced several dips in this week alone. But downwards movement on the charts has not been to a significant extend. The price had tested $48K this week. Eventually breaking back down below $44K when faced with resistance at this level.
Trailing prices now rest in the $44K territory for BTC. Price analysis shows the mark to beat for another rally sits at $46K with the current momentum. As of the time of this writing, BTC is currently trading at $44,470, with an overall market cap of $835 billion.
Featured image from Bitcoin News, charts from Twitter and TradingView.com
via NewsBTC