Bitcoin’s price has been in an uptrend for the last day, as it once more reaches $44k. According to data on the blockchain, it may have been due to an increase in foreign exchange outflows.
Bitcoin Exchange outflows noticed a spike in the past couple of days
In a CryptoQuant blog post, an analyst noted that BTC exchange outflows had seen increased values in recent months.
The “all exchanges outflow” is an indicator that measures the total amount of Bitcoin exiting wallets of all exchanges.
The metric’s current value is increasing, which means that more BTC are leaving exchanges. This trend is usually bullish, as holders typically withdraw their coins from exchanges to keep them safe. An indicator of whale accumulation can be an excessive outflow.
On the other hand, when the indicator’s value stays low, it implies not many investors are moving their Bitcoin off exchanges at the moment.
The opposite indicator, the inflow can spike up and this could make the trend bearish. This happens because most holders deposit money to exchanges in order to withdraw fiat currency or buy altcoins.
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Here’s a chart showing the Bitcoin All Exchanges Outflow Indicator over the last year.
It seems that the indicator's value has risen. Source: CryptoQuant| Source: CryptoQuant
You can see that Bitcoin’s outflow value has increased in recent weeks, as you can see from the graph. The result is that there have been a lot of withdrawals in the last few days.
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This trend could indicate that some investors are important for the $40k price point, according to the quant. Whenever the crypto approaches a support level, outflow spikes like these usually occur as holders are keen to buy more as Bitcoin’s value dips to such levels.
BTC price
At the time of writing, Bitcoin’s price floats around $43.8k, up 2% in the last seven days. The crypto’s value has fallen 12% over the last month.
Below is a chart showing the change in BTC’s price over the past five days.
Source: BTCUSD on TradingView| Source: BTCUSD on TradingView
Bitcoin has finally shown signs of movement after weeks of a downtrend. The crypto crossed the $44k threshold several times during the last day.
This may be due to the increase in exchange outflows. It’s unclear at the moment if this is the rally that will help the crypto escape from the $40k to $45k range. Nonetheless, it’s some upwards momentum for the coin at last.
Unspash.com's featured image. Charts by TradingView.com. CryptoQuant.com chart.