The on-chain analysis shows huge Bitcoin outflows from the Binance crypto exchange. BTC could continue the rally and crack $ 40,000.
Huge Bitcoin outflows at Binance
As can be seen from a CryptoQuant post, the crypto exchange observed enormous BTC outflows on Monday.
The Binance Outflows indicator shows the amount of Bitcoin that has been transferred from the Binance Exchange wallets to personal or other exchange wallets.
On the other hand, the inflows show how many BTC were sent from other wallet types into Binance wallets.
The indicator that is most interesting here is the Binance Bitcoin Netflow, which is just the inflow minus the outflow.
Binance BTC Netflow = inflow – outflow
Here is a chart for the Binance Bitcoin Netflow showing the trend in the value of the indicator over the past few weeks:
BTC netflow on Binance shows deep negative for 26 July | Source: CryptoQuant
As the graphic above shows, the crypto exchange is currently experiencing two huge outflows. One of them was over 10k BTC while the other was around a whopping 31k BTC!
There also appears to be an inflow of around 10,000, similar to the value of one of the outflows. A look at http://chain.info shows that this inflow and outflow is actually the same transaction between Binance’s internal wallets.
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However, the 31k BTC outflow is not part of an internal transaction. Usually negative net flows mean that the market is not under a lot of selling pressure. Huge negative net flows like this one can drive the price up.
At the time of writing, the price of Bitcoin is hovering around $ 37,000, up 26% over the past 7 days. The increase compared to the previous month is around 14%.
Here is a graph showing the trend in the crypto price:
BTC's price suddenly surges up | Source: BTCUSD on TradingView
Bitcoin has finally broken the USD 35,000 resistance level. Previously, the cryptocurrency was stuck in the $ 30,000 to $ 35,000 range for some time as market volatility hit annual lows.
Now, however, the rumors of Amazon opening up to BTC and crypto payments have helped drive the price of the coin up.
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It looks likely that the price of BTC will continue to climb to $ 40,000. However, it remains to be seen whether the digital currency can exceed this level.
The Bitcoin surge could very well stop after hitting the USD 40,000 resistance level and the market could be bound to a range below that level. Or maybe it will carry the bullish momentum and cross the range to continue beyond.