The analysis of exchange netflow on Binance revealed a significant shift for Bitcoin price, marking a potential turning point.
Historically, when the Simple Moving Average over 14 days (SMA14) for netflow turned positive, it often signaled upcoming selling pressure, leading to short-term price corrections.
Notably, this pattern reversed as the SMA14 transitioned into negative territory on January 6, 2025. This suggested a decrease in selling pressure and an increase in buying activity.
This change was quantified by the Binance netflow reaching -5,407, with the SMA14 also dipping to -483.
These figures indicated that there is a stronger buying sentiment among investors on the platform. Potentially heralding a positive trend for Bitcoin price in the near term.
These transitions in netflow metrics were crucial indicators of market sentiment and can precede significant price movements.
Given the recent negative cross in the SMA14, the outlook for Bitcoin could be optimistic. The recent market correction might be concluding and a bullish phase could be emerging.
The scenario was supported by a noticeable increase in investor interest. The same was reflected in the net buying trend on Binance, suggesting an upbeat market sentiment moving forward.
Bitcoin Price: Profitability of BTC Addresses
Bitcoin price started the year strong. It reclaimed the $100,000 mark in the first week of January which is anticipated to be a bullish year.
The in/out of the money indicator showed a substantial green cluster up to the $101,710.79 price point. Which meant that many addresses are in profit up to this level.
Beyond this, the market exhibited increasing pressure with addresses that bought at higher prices still out of the money, highlighted by the red zones extending up to $106,839.06.
This distribution suggested that while Bitcoin price had performed well, though significant resistance lay ahead.
The dense cluster of profitable addresses could act as a strong support base if prices were to dip.
However, the presence of significant numbers still at a loss at higher levels could curb upward movement for Bitcoin price.
This would make it challenging to sustain rallies without additional positive triggers. Approximately 380,000 addresses are still at a loss, representing less than 1% of all Bitcoin holders.
This small percentage indicated that the market correction might be nearing its end. Most holders were positioned for potential gains if Bitcoin can maintain its upward trajectory and break through existing resistance levels.
Long-Term Holder Supply
The dynamic between Bitcoin‘s Short-Term Holders (STH) and Long-Term Holders (LTH), displayed notable transition in the supply patterns.
Initially, as Bitcoin price soared towards $100,000, there was a marked increase in the selling activity, primarily among STH.
This selling peak was reflected in the significant movement of coins from the STH to the LTH cohort, a typical behavior when traders capitalize on high prices.
In the subsequent period, the LTH supply saw a gradual increase. This trend suggested that coins held by STHs for less than 155 days began aging into the LTH category, which traditionally holds for much longer periods.
The shift towards a larger LTH supply indicated a potential decrease in selling pressure at high price levels, as more holders moved into a long-term investment mindset.
This transition could suggest a stabilization of prices at higher levels if the trend of coins moving to LTH continues.
Historically, an increase in LTH supply correlates with reduced market volatility and a more robust price support, implying that significant sell-offs might have subsided for the time being.
Thus, if this growth in LTH supply is confirmed in the coming days, it would likely signal a concluded phase of LTH selling, setting a more bullish tone for Bitcoin’s near future.
