On-chain data from IntoTheBlock shows a significant drop in inflows of Bitcoin (BTC-USD) to cryptocurrency exchanges. How low? The lowest in nearly a decade. In fact, the drop in inflows between April 22 and May 6 hasn’t been this low since December 29, 2014. Here are some of the takeaways from this data:
- Selling pressure has decreased.
- If demand does spike, there is a very real chance of supply shock occurring. Supply shock occurs when demand outstrips supply, and those holding the supply are not selling at any price. In that event, price discovery takes over, and prices skyrocket.
ETFs and Market Impact
Bloomberg’s Yoda of ETFs, Eric Balchunas, took to X and pointed out a big first for the BTC ETFs. For the first time in their short history, all BTC spot ETFs saw their one-day flows decked out in green—no specks of red.
Now, we’re not about to spike the football or run a victory lap, but let’s just say the scoreboard speaks volumes. Balchanus pointed out that over 95% of those steely-nerved ETF investors clung to their holdings through a downturn that wasn’t just a dip—it was a nosedive.
Balchunas pondered whether this iron grip would hold up in future market tumbles. The crystal ball’s a bit murky, but if we’re betting on past performance, the odds are stacked in favor of diamond hands holding again. “Diamond hands” is a term used to describe investors that keep holding onto their investments, no matter what the market throws at them. They’re like the rock-solid folks who stay strong and don’t panic when things get rough.
From a price action and technical analysis perspective, Bitcoin is a bit of a mixed bag. It bounced off a dominant interior trendline at $57,000 last Thursday and has so far held up against typical weekend volatility. Additionally, bulls have held the $60,000 value area from sellers.
Is Bitcoin a Buy?
According to TipRanks’ Summary of Technical Indicators, Bitcoin is a Buy.
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