Bitcoin is currently fluctuating around $97,000 over the past 24 hours, maintaining a range between $98,600 and $95,000 throughout last week. In light of this back-and-forth movement, data indicates a negative sentiment among Bitcoin traders, which could lead to a price decline.
Data from the on-chain analytics platform IntoTheBlock reveals that Bitcoin experienced approximately $1.4 billion in net inflows into crypto exchanges during the week just ended.
Bitcoin Exchange Inflows Surge Amid Market Volatility
According to information from IntoTheBlock, shared on the social media platform X, $1.04 billion was directed into crypto exchanges last week. This influx eliminated the outflows of the previous three weeks. IntoTheBlock notes that this significant shift in capital movement points to an increasing reluctance among Bitcoin holders, largely attributed to ongoing geopolitical and economic uncertainties.
Moreover, the Bitcoin network has experienced a noticeable decline in transaction fees. On-chain data indicates a 10.74% drop in fees compared to the prior week. This reduction in fees suggests decreased network activity, a potential bearish signal. Conversely, rising transaction fees typically indicate higher demand and increased market activity, while falling fees point to waning interest and diminishing momentum for Bitcoin’s price.
Image From X: IntoTheBlock
Spot Bitcoin ETFs Likely Influencing Exchange Inflows
A significant contributor to the increase in Bitcoin exchange inflows may be the outflows from Spot Bitcoin ETFs. US-based Spot Bitcoin ETFs have played a crucial role in Bitcoin’s bullish trend this year, with continuous inflows supporting price gains. Nonetheless, the situation was markedly different for these Spot Bitcoin ETFs last week.
Specifically, data from SosoValue indicates that US-based Spot Bitcoin ETFs recorded net outflows of $651.83 million over the previous week. Notably, this marks the largest weekly outflow for these ETFs since the first week of September 2024. This trend suggests that some institutional investors are liquidating their Bitcoin holdings, possibly to lock in profits or due to persistent uncertainties following the sharp price decline at the start of February.
Image From SosoValue
The Bitcoin inflows into crypto exchanges could strengthen the bearish sentiment surrounding Bitcoin, particularly as it exerts selling pressure on exchanges. Technical analysis reveals that Bitcoin is currently situated between crucial supply and demand levels. As per crypto analyst Ali Martinez, there exists a substantial demand wall of 1.43 million BTC between $94,660 and $97,540, while a supply wall of 1.16 million BTC lies between $97,650 and $99,470. A breakout in either direction could potentially dictate the trend for the next significant move.
Should Bitcoin breach the resistance at $99,470, it could catalyze new buying enthusiasm, potentially propelling the price back above the $100,000 threshold. Conversely, a continued downward adjustment could emerge if selling pressure escalates, leading BTC to fall below the $94,660 support level.
Image From X: Ali_Charts
At present, Bitcoin is valued at $97,504.
Featured image from KITCO, chart from TradingView
