Mass panic rippled throughout the larger cryptocurrency market as the SEC accused Kraken, a cryptocurrency exchange based in California, of running an unregistered crypto staking scheme on Thursday. Bitcoin lost almost 5% at the time, resulting in hitting the fag end of the $21K level while reaching a peak of $24K few weeks back. However, current market data reveals a significant uptick in the price of Bitcoin (BTC) as it reclaims the $21,800 price mark in the past 1 hour.
Bitcoin Shows Bullish Signals
Bitcoin, as per certain on-chain data is currently fighting with the 50MA (moving average), and its monthly chart appears to be offering a buying opportunity with several indications. A recent post on CryptoQuant made by an analyst highlighted the fact that there has been an increase in the reserves held by crypto exchanges. An “exchange reserve” is an indicator that measures the total quantity of Bitcoin that is currently being stored in the wallets of a centralized exchange.
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When the value of this indicator rises, it indicates that investors are now adding their coins to the exchange where they are being traded. Since investors typically use spot exchanges for selling objectives, the reserve exhibiting this pattern could be adverse to the price of the cryptocurrency if the platform in issue is a spot exchange.
A declining reserve, on the other hand, may indicate that holders are currently withdrawing their coins from the exchange in question. In most cases, owners will transfer their coins to a cold wallet in order to store them securely for an extended length of time. As a result, this kind of trend might be bullish for the price in the long run because it indicates a reduction in the amount of selling pressure that is being exerted on the asset.
Bitcoin’s Price Recovery
While it is clear that this indication has been on an upward trajectory during the past two days–thanks to the spot deposits–the metric as a whole has been falling over the last two weeks, which shows that the market has been witnessing some level of net Bitcoin accumulation. If these withdrawals are considered as an indication of buying, then the coin might still see a bullish influence in the long run.
Additionally, it should be noted that BTC’s technical analysis (TA) indicators at CoinGape’s crypto market tracker recommend a neutral position as summarised from the moving averages; suggesting a “buy” at 8 and “sell” at a level 10. As things stand, the price of Bitcoin is currently trading at $21,812 which represents an increase of 0.14% over the past 1 hour, in contrast to a drop of 6.40% over the last seven days.
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