Bitcoin is in focus yet again as significant on-chain data from Binance, the largest cryptocurrency exchange, unveils important trends. The main idea centers around Binance's Netflow Simple Moving Average (SMA14), an influential metric linked to short-term price movements of Bitcoin, and its current patterns hint at potential market shifts.
CryptoQuant analyst Burak Kesmeci's recent analysis provides insight into Binance's Netflow from the past 90 days.
His observations highlight that positive Netflow SMA14 typically aligns with short-term selling pressure on Bitcoin, often triggering temporary corrections.
Conversely, negative movement in this metric suggests an accumulation phase, marking a potentially bullish trend in the short term. On January 6, 2025, insights from Binance's Netflow showed a value of -5,407 BTC with the SMA14 at -483 BTC. These figures indicate more Bitcoin exiting than entering the platform, a telltale sign of accumulation by investors.
Both -5,407 BTC and -483 SMA14 underline investor behavior leaning towards accumulation at Binance. The favored strategy supports prospects for Bitcoin's upward price movement in the short term.
Historically, such patterns have served as early indicators of potential increases in price, since reduced exchange availability limits immediate selling capacity. Relocating Bitcoin from exchanges suggests holders' inclination towards long-term holding. This trend indicates a supply squeeze with reduced liquidity exerting upward pressure on prices. Binance’s vast trading volumes enhance this indication of a supply squeeze, acting as a market sentiment barometer. Kesmeci notes:
Despite a semblance of bullish momentum, Bitcoin's recent price movements display reduced rally durability. A trading price above $102,000 was noted less than 24 hours ago following a 4% rise. Yet, this gain was largely negated, as the price aligns slightly above $100,000.
Currently valued at $100,630, Bitcoin's price reflects a modest 1.3% daily increase, although it lingers 7% below its peak of $108,135 from the preceding month.