The selling pressure on Bitcoin is decreasing as the supply of BTC on exchanges starts to decline after the last drop.
The selling pressure on Bitcoin (BTC) decreases as the outflows start to increase once more. Exchanges typically indicate a decrease in selling pressure on Bitcoin because whales or high net worth investors invest BTC in the exchanges when they want to sell it. Hence, when the stock exchanges rise, it means that the whales are removing their BTC from the exchanges. This means there are less BTC to sell on exchanges, reducing the selling pressure on BTC.
Bitcoin At An Important Crossroads
Bitcoin is at a difficult juncture, where it has to rise above $ 20,000 to see a big rally or move to a longer phase of consolidation. For now, analysts at Santiment say that Bitcoin’s retreat to $ 18,750 has been met with an incentive trend for investors to ditch BTC.
However, falling stock market supply does not guarantee that the selling pressure will not reappear in the near term. Whales can quickly invest Bitcoin in exchanges when they want to sell it. This is exactly what happens as BTC approaches $ 20,000. Continuous selling pressure from whales last week prevented BTC from exceeding its all-time high. Other data points on the chain, such as the CryptoQuant’s Bitcoin Exchange Flows indicator, show that whales continue to invest more BTC in exchanges. Therefore, although the overall BTC supply in exchanges is on the decline, sales from whales can increase the selling pressure on BTC.
Institutions Trust BTC More
One variable that can stimulate the sentiment around Bitcoin is the constant flow of capital from institutions to BTC. MicroStrategy announced another $ 50 million investment in Bitcoin this week after buying it worth about $ 425 million over the past few months. It is not yet clear whether the growing trust of institutions in Bitcoin will resist the sale of whales. The techniques also indicate that a major volatility surge is approaching. It remains unclear whether this move will mean a correction is coming or another rally is approaching.