On-chain data shows the Bitcoin exchange netflow has observed a sharp positive spike recently, a sign that could be bearish for the crypto’s price.
Bitcoin All Exchanges Netflow Spikes Up Following 9% Inflation Report
As pointed out by an analyst in a CryptoQuant post, exchanges have recently seen a large amount of BTC deposits.
The “all exchanges netflow” is an indicator that measures the net amount of Bitcoin entering or exiting wallets of all centralized exchanges as a whole. The metric’s value is calculated by simply taking the difference between the inflows and the outflows.
When the value of the netflow is positive, it means a net number of coins are moving into these wallets right now. As investors usually deposit their coins to exchanges for selling purposes, this kind of trend can prove to be bearish for the value of BTC.
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On the other hand, the value of the indicator being negative suggests investors are withdrawing their coins at the moment. Such a trend, when prolonged, can be a sign of accumulation from holders, and hence can be bullish for the price of the crypto.
Now, here is a chart that shows the trend in the Bitcoin all exchanges netflow over the past week:
Looks like the value of the metric has spiked up recently | Source: CryptoQuant
As you can see in the above graph, the Bitcoin exchange netflow has observed a positive spike over the past 24 hours.
There was another spike not too long before this latest one, but that other spike was neutralized by a similarly large negative value of the metric.
The quant in the post notes that inflows on the crypto exchange Gemini (which is popularly known to be used by whales) have contributed to this positive netflow value.
These deposits have come a couple of days after the CPI report for the month came out and revealed that inflation rose 9% in June.
If the inflows are indeed from whales looking to dump their coins, then the near term outlook can be bearish for the price of Bitcoin.
At the time of writing, Bitcoin’s price floats around $20.8k, down 4% in the last seven days. Over the past month, the crypto has lost 7% in value.
The below chart shows the trend in the price of the coin over the last five days.
After the upwards move, the value of the crypto seems to have been moving sideways over the last couple of days | Source: BTCUSD on TradingView
Featured image from anvesh baru on Unsplash.com, charts from TradingView.com, CryptoQuant.com
Image and article originally from www.newsbtc.com. Read the original article here.