Bitcoin hit a new all-time high (ATH) above $104,000 in the past day, but on-chain data shows investors are still unwilling to sell.
Bitcoin Exchange Netflow has remained negative during the latest rally
As explained by an analyst in a CryptoQuant Quicktake afterBitcoin has continued to leave the stock markets lately. The relevant on-chain metric here is the ‘Exchange Netflow’, which, as the name suggests, tracks the net amount of BTC entering or leaving the wallets associated with centralized platforms.
When the value of this measure is positive, it means that investors are making net deposits on the stock exchanges. Since one of the main reasons why holders use these platforms is for sales-related purposes, this type of trend could have a bearish implication for BTC.
On the other hand, a negative indicator means that there is a greater outflow of currency than inflows. Such a trend could be a sign that investors want to hold onto their coins for the long term, something which can obviously be bullish for the asset’s price.
Here is a chart showing the trend in the Bitcoin Exchange Netflow over the past few years:
As shown in the chart above, the Bitcoin Exchange Netflow has seen significant negative spikes over the past month, indicating that some large withdrawals have occurred.
This net outflow has occurred even as the cryptocurrency has seen a massive run to new ATHs. The graph shows that this was not the case during the rally in the first quarter of this year.
There were certainly outflows at the time, but there were also notable net inflow spikes between the two, implying that there was demand to sell the asset.
The recent negative Exchange Netflow has held for Bitcoin during the last rally above $100,000, a sign that investors are still unwilling to part with their BTC even at these high prices.
If this trend continues, it’s possible this run has even more room to run. However, it remains to be seen how long the holders can remain stationary.
In general, the higher investors’ profits are, the more likely they are to participate in a massive sell-off. So with Bitcoin continuing to perform well, it may only be a matter of time before major profit-taking occurs.
BTC price
Bitcoin has finally broken free from its recent consolidation phase with a rise of over 7% in the past 24 hours. The asset briefly broke above the $104,000 mark during this rally, but its price has since seen a small pullback to $103,500.