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Bitcoin’s [BTC] exchange inflow and outflow are signaling…

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Bitcoin’s [BTC] exchange inflow and outflow are signaling…

Bitcoin’s fall in price on 28 June can be considered quite significant for the king coin. It has effectively ripped out all the bullish surges from the past week and has reduced BTC back to the 3AC crash valuations. One may question- Is this an indication of a severe pullback or a minor setback?

See you on the other side

At the time of writing, BTC was hovering around $20,000 yet again, which is beginning to seem like a familiar situation for investors. This is the first time that BTC dipped to such a low in the last seven days. The cryptocurrency market was showing considerable recovery until the dip of 28 June.

BTC was down 5% in the last 24 hours of 29 June. According to CoinShares data, exchange outflows for Bitcoin specific funds accounted for $453 million in the past week.

This has in turn wiped out all the inflows deposited in the past six months. Also, as per a CryptoQuant update, there has been rampant exchange inflows on Coinbase from different age bands of Bitcoin owners.

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The largest contribution is from the six to 12 months group who were responsible for 3.1k BTC holdings. Furthermore, the 12-18 months and the three to five year bands were responsible for holdings of 200 BTC each.

Source: CryptoQuant

The latest data suggests a surge in the transaction volume on the Bitcoin network. That should have provided some respite for the otherwise stunted investors but that is not the case. As mentioned above, there is growing FUD in the crypto market and BTC is obviously an important cog in the wheel.

As per a Glassnode tweet, Exchange Outflow Volume (7d MA) just reached a 19-month low of $30,517,649.52. This has also become a cause of worry among investors with exchange inventories stacking up.

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Source: Glassnode

Notably, a daunting moment for investors was highlighted during Gary Gensler’s latest crypto talk. Gensler, the SEC Chairman told Financial Times, that there is a need for “one rule book” for crypto regulations.

“I’m talking about one rule book on the exchange,” he said.

That being said, investors have been looking for profit-making opportunities which depend on the market scenario. Now, only time will reveal if broader market condition can recover soon.

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Kanav is a journalist at AMBCrypto. He has a Masters in Media and International Conflict and is interested in areas of digital society, crypto developments in the political sphere and the socio-cultural impact of a crypto-society.

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Bitcoin

TA: Bitcoin Price Takes Hit, Why BTC Remains at Risk of More Losses

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TA: Bitcoin Price Takes Hit, Why BTC Remains at Risk of More Losses

Bitcoin price started a fresh decline from the $24,250 resistance zone against the US Dollar. BTC declined below $23,000 and remains at a risk of more losses.

  • Bitcoin started a fresh decline below the $23,500 support zone.
  • The price is now trading below the $23,500 level and the 100 hourly simple moving average.
  • There was a break below a major bullish trend line with support near $23,320 on the hourly chart of the BTC/USD pair (data feed from Kraken).
  • The pair must clear the $23,250 resistance to start a fresh increase in the near term.

Bitcoin Price Breaks Support

Bitcoin price struggled to gain pace above the $24,000 resistance zone. The price formed a top near $24,285 and started a fresh decline.

There was a clear move below the $23,800 and $23,500 support levels. The bears pushed the pair below the 61.8% Fib retracement level of the upward move from the $22,846 swing low to $24,286 high. Besides, there was a break below a major bullish trend line with support near $23,320 on the hourly chart of the BTC/USD pair.

Bitcoin price is now trading below the $23,500 level and the 100 hourly simple moving average. It is now consolidating above the key $22,650 support zone.

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Source: BTCUSD on TradingView.com

On the upside, an immediate resistance is near the $23,250 level. The next key resistance is near the $23,500 zone. A close above the $23,500 resistance zone could start a steady increase. In the stated case, the price may perhaps rise clear the $24,000 resistance.

Downside Break in BTC?

If bitcoin fails to clear the $23,500 resistance zone, it could continue to mov down. An immediate support on the downside is near the $22,650 level.

The next major support now sits near the $22,500 level. A close below the $22,500 level might start a move towards $22,000. If the bears remain in action, there is a risk of a move towards the $21,500 level in the coming sessions. Any more losses might send the price towards $20,500 level.

Technical indicators:

Hourly MACD – The MACD is now gaining pace in the bearish zone.

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Hourly RSI (Relative Strength Index) – The RSI for BTC/USD is now well below the 50 level.

Major Support Levels – $22,650, followed by $22,500.

Major Resistance Levels – $23,250, $23,500 and $24,000.

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Bitcoin

Weekly crypto asset flow has these profit-making statistics

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Weekly crypto asset flow has these profit-making statistics

Inflows into digital asset investment products totaled $3 million last week, bringing the sixth consecutive week of inflows to a total of $529 million, CoinShares found in a newly published report.

Last week’s inflow represented a 96% decline from the $81 million recorded in inflows the previous week.

Source: CoinShares

Inflows into digital asset investment products totaled $3 million last week, bringing the total inflows since the beginning of the month to $3.1 million.

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CoinShares found that last week’s inflows represented 1.7% of the total assets under management (AuM). It further stated that despite the market downturn in the last quarter, 32 new investments have been launched, primarily in altcoins.

Source: CoinShares

Bitcoin and Bitcoin-short in the last week

According to the report, last week, Bitcoin logged outflows. These outflows totaled $8.5 million. The outflows recorded brought the year-to-date (YTD) inflows for the king coin to $311.9 million, a decline from the YTD index of $326.1 million recorded in the previous week. 

Still, a king, Bitcoin’s YTD inflows represent 63% of the YTD total inflows of $492 million recorded by all assets considered by CoinShares in the report. 

Further, Coinhares found that short-Bitcoin investment products also recorded outflows that totaled $7.5 million. That was the second consecutive week of outflows for short-Bitcoin. In the previous week, it saw outflows of $2.6 million. 

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These outflows, according to CoinShares, suggest that “investors believe bitcoin prices have troughed.”

What about Ethereum?

For Ethereum, inflows in the last week totaled $16 million, bringing it to its near seven consecutive week run of inflows of $159 million. 

“We believe this turn-around in investor sentiment is due to greater clarity on the timing of The Merge where Ethereum shifts from proof-of-work to proof-of-stake,” CoinShares stated.

The report, however, stated that on a YTD basis, the leading alt had seen outflows of $300 million. 

Source: CoinShares

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Regionally, most inflows were from North America and Europe, with inflows from the United States and Germany totaling $16.8 million and $7.8 million, respectively.

All other regions considered in the report registered inflows except Canada, which saw an outflow of $29.9 million.

Source: CoinShares

Commenting on the reason for the low weekly inflow, CoinShares, thus, stated:

“Despite improving sentiment, trading volumes remain very low at US$1.1bn for the week versus the year-to-date weekly average of US$2.4bn. We believe the low participation is seasonal as a similar trend has been seen in previous years.”

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Abiodun is a full-time journalist working with AMBCrypto. He is also a lawyer with over 2 years of experience. With a keen interest in blockchain technology and its limitless possibilities, Abiodun spends his time understanding the technology, building projects, and educating people about it.

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Why Are Crypto Investors Rotating From Bitcoin To Altcoins?

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Why Are Crypto Investors Rotating From Bitcoin To Altcoins?

The crypto market is pulling back into support and could face potential headwinds in the short term. In the crypto top 10, Bitcoin has been outperformed by the altcoins sector with Ethereum and Binance Coin, and Polkadot still preserving some of its gains from the past week.

This shows a shift in the crypto market dynamics as investors seem to be regaining confidence in the sector and moving away from Bitcoin. Therefore, the number one crypto by market cap appears to be lagging which translates into a decline in Bitcoin dominance.

As seen below, this metric has been moving sideways since May 2022 after seeing a small push to the upside. In 2021, as Ethereum and other altcoins reached new all-time highs, Bitcoin dominance plummeted to its current levels.

BTC dominance moving sideways as BTC’s price lags the altcoins sector on the 4-hour chart. Source: BTC.D Tradingview

If the current trends continue, Bitcoin lagging the altcoin sector, the metric could re-test its yearly lows and drop from 43% into the high 30% area which could provide altcoins with more room to reclaim previously lost territory.

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According to a report from Arcane Research, their Crypto Indexes for altcoins have been showing positive returns in August. As seen below, the research firm records 9%, 7%, and 5% profits for their Large, Mid, and Small Cap Index while Bitcoin records 2% profits.

Source: Arcane Research

The latter shows the biggest increase as risk exposure trends upwards, and stablecoins market shares follow a similar trajectory as that of the Bitcoin dominance. Arcane Research noted:

With bitcoin underperforming relative to altcoins, the bitcoin dominance has plummeted from a peak of 47% in the middle of June to 40.5% now. As the market sentiment has improved traders have been more interested in getting exposure to altcoins than bitcoin.

In the crypto market, altcoins might continue to dominate in the short as BTC’s price moves sideways. Thus, investors seeking higher returns might consider rotating into Large to Mid-cap cryptocurrencies, and Small Cap if they have bigger risk tolerance.

Why Is The Crypto Market Seeing Short-Term Downside Price Action

Despite a positive month for the majority of the crypto market, most cryptocurrencies are experiencing downside price action on low timeframes. This is due to the potential short-term impact of the macro-economic factors affecting the sector.

Tomorrow, the U.S. Federal Reserve (Fed) will release July’s Consumer Price Index (CPI) print. This metric is used to measure inflation in the U.S. dollar, which has been trending upwards and stood at a 40-year high.

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Thus, the Fed has been hiking interest rates and shifting its monetary policy in an attempt to slow down inflation. If July’s CPI print hints at success in those attempts, the financial institution might be inclined to act less aggressively.

This could lead to a stronger bullish momentum across risk-on assets, such as Bitcoin and the crypto market. In the meantime, market participants seem to be sidelined and expecting tomorrow’s outcome. A pseudonym trader said the following on the above:

CPI relation with Bitcoin. Now that gas prices are lowering, we’ll see a decrease or inflation holding/cooling. This will give confidence back to investors. Fed rate lowers to 50 bps at next FOMC meeting, showing optimism to investors. Don’t get shaken out before the move up.

Source: IncomeSharks via Twitter

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