A quick recap of November
Following numerous unsuccessful tries, the price of bitcoin (1) rose again into the $17,000 range. According to on-chain measurements, all exchange BTC deposits increased by 44% in November. Similar deposit inflows have caused a 20% decrease, which would predict Bitcoin's price to the $13,000 range. Just before the November auction ended, the price of bitcoin made a countertrend move. On-chain measurements, however, indicate that the slide is still ongoing.
Deposits at bitcoin prices increased 44% in November. Following a last-minute countertrend rebound into the $17,000 price region sparked by the bulls, the price of bitcoin is currently consolidating as profit-taking. The bullish gesture is undoubtedly upbeat following a feeble bearish denial close to the indicated price zone. However, Bitcoin will have to show much more strength as the likelihood of another southward movement is still high. At this time, the price of one bitcoin is $16945. On-chain analytics from IntoTheBlock (2) give hints as to what Bitcoin's long-term goals could be. In particular, the Inflow Volume Indicator, which tracks all exchange deposits, has surged by 44% month over month.
How would these changes impact traders?
The indicator recorded a surge of 165,290 Bitcoin supplied to exchanges on November 18. The indicator last had a comparable surge on September 14th. When BTC traded at $20,000 at the time, 281,230 Bitcoin were put into working wallets and exchanges. The Inflow Volume indicator is intended, in principle, to assess market sentiment and support increases in liquidity. However, there is a prejudice in the cryptocurrency community that more deposits are better. This leads to a sell-off ultimately when an asset is placed on exchanges. The past two upticks in Bitcoin did cause a 20% collapse. However, it took many weeks for the downward trend to materialize.
A 20% decrease for the peer-to-peer digital currency would not be a far-fetched prospect when considering the on-chain data. This rise would bring the price of BTC close to the upper limits of the $13,000 zone, a price range that hasn't been traded since 2020. A violation of the $13,880 price barrier would negate the possibility of a bull run in Bitcoin, as stated in the macro thesis on the cryptocurrency formed earlier this year.