Bitcoin has recently experienced mixed market movement with analysts monitoring On-chain data to understand the short-term trajectory of major cryptocurrencies.
On-chain metrics show a significant shift in exchange activity, with Tether (USDT) seeing significant outflows while Bitcoin (BTC) flows across exchanges remain high. This suggests a possible “imbalance” in the trend Market dynamicsWhere selling pressure may lead to further price corrections in the short term.
Spot market trends and selling pressure signal potential downside
According to data shared by CryptoQuant analyst Onatt, more than 15,000 BTC have been seen floating across exchanges, a metric particularly associated with the increased likelihood of a sell-off. At the same time, Tether outflows represent a decrease in liquidity within these exchanges.
Tether outflows and Bitcoin inflows indicate short-term weakness
“Significant amounts of Tether (USDT) are exiting exchanges, and a large flow of Bitcoin (BTC) (>15K) has been seen entering exchanges.” – by @tutunculeronat
link
https://t.co/NFCLi7EpiI pic.twitter.com/6lUyTiEdNi
— CryptoQuant.com (@cryptoquant_com) December 24, 2024
Historically, such movements have been associated with short-term price declines, as traders and institutional investors reposition their portfolios. Market volatility.
However, ONAT noted that while these indicators indicate a short-term downside risk, there does not appear to be any significant macroeconomic catalyst driving a longer-term bearish trend. The analyst specifically wrote:
This combination of factors could signal the possibility of further short-term downside in Bitcoin’s price. However, from a macroeconomic perspective, there appears to be no catalyst that would require a prolonged bearish trend after this short-term correction.
Major indicators suggest mixed signals in the Bitcoin market
TraderOasis, another analyst, highlighted additional metrics influencing Bitcoin’s price behavior. A key observation focused on the Coinbase Premium Index, which failed to comply Bitcoin’s upward momentum During its last price hike. Oasis noted:
As a result, the price retreated. We are now in negative territory. I expect a break in the market to continue the rise.
In particular, this disconnect indicates a lack of strong Buying activity From US-based investors, often considered a significant driver of Bitcoin’s upward movement. The analyst also noted that funding rates have started to decline while open interest levels are rising.
Falling funding rates combined with rising open interest usually indicate that traders are opening more short positions. This suggests a bearish sentiment in the pattern Derivative marketsTraders are hoping for a continuation of the downward trend or, at best, a period of sideways movement.
Furthermore, the combination of declining funding rates and rising open interest suggests that the market may remain in a consolidation phase for some time. TraderOasis wrote:
I think the price will move sideways because of the Christmas week. Then the movement of division will begin.
Featured image created with DALL-E, chart from TradingView
