- On-chain data shows renewed buying interest and lower supply on Binance, driving Bitcoin’s recent price surge.
- Open Interest and active addresses also indicate stronger market participation and potential for further gains.
Bitcoin [BTC] has been on a volatile path since the beginning of the year. After an early rally, the cryptocurrency suffered a sharp correction, leaving many investors unsure about its price direction of the market.
However, a recent surge on January 20th pushed Bitcoin’s price to a new all-time high, briefly rising above $109,000.
Although the asset saw a slight pullback, trading at $107,945, it continued to rise 3.5% over the past 24 hours, reflecting double-digit gains over the past week.
Amid this price activity, analysts have been keeping a close eye on key on-chain metrics.
According to a CryptoQuant analyst, the Binance Netflow SMA30 – a 30-day moving average of net flows on Binance – has provided valuable benefits. insights in market sentiment and price developments.
The analyst points out that shifts in this measure often correlate with notable price movements, suggesting the current rally may have more room.
Bitcoin netflow trends and market dynamics
The Binance Netflow SMA30 metric has historically been a useful indicator for anticipating Bitcoin’s short-term price direction.
When the metric enters positive territory, it often indicates increased selling pressure as more Bitcoin flows into Binance.
For example, in May 2024, a positive Netflow SMA30 coincided with a drop in Bitcoin’s price from $71,000 to $50,000, highlighting a period of increased supply and bearish sentiment.
Source: CryptoQuant
Conversely, when the Netflow SMA30 turns negative, it typically indicates reduced spot supply and stronger upside momentum.
This pattern was clearly visible in November 2024, when the benchmark turned negative and Bitcoin rose from $74,000 to $108,000.
As of January 17, the SMA30 returned to negative territory, at -207.85, signaling renewed buying interest and raising the possibility of another rally to a new all-time high.
Additional insights
In addition to the Binance Netflow SMA30, other indicators offered a broader perspective on Bitcoin’s short-term prospects.
Open interest data from Coinglass shows up 4.61% in the last 24 hours, reaching a valuation of $71.21 billion.
Source: Coinglass
Open Interest volume also increased by 156.60% to $179.14 billion over the same period.
These increases reflected growing trader involvement and potential momentum in the derivatives market, which could impact Bitcoin’s spot price.
Moreover, Glassnode facts at active addresses – a proxy for retail participation – revealed recent spikes in user activity.
Read Bitcoin’s [BTC] Price forecast 2025–2026
The number of active addresses rose from less than 1 million earlier this month to 2.2 million on January 17, before falling to 1.1 million on January 19.
Source: Glassnode
While the fluctuation in active addresses indicates variability in retail interest, the overall increase earlier this month suggests more participants are engaging with the Bitcoin network.