An analyst has explained how Bitcoin will likely continue the latest bullish swing, at least in the short-term.
Bitcoin Spot Exchange Supply Has Been On The Decline Recently
In a new on X, analyst Willy Woo has discussed the short-term and medium-term trajectories that BTC could follow. For the former, the analyst says the bullish trend would continue, with “likely 1 week left in play.”
Below is the chart shared by the analyst that shows the trajectory in the value of this metric over the last few years.
As is visible in the above graph, the Spot Bitcoin exchange supply (the blue line) has declined recently, suggesting that investors have been withdrawing their coins into self-custodial wallets.
Generally, one of the main reasons investors keep their coins on spot platforms is for selling purposes, so the Spot BTC inventory can be viewed as an estimation of the available sell supply for the cryptocurrency. As such, the investors taking their coins out of this supply can naturally be a bullish sign for Bitcoin.
In today’s era, however, the Spot BTC isn’t the only factor affecting the asset’s price, as another form of exchange supply has gained popularity in the last few years: Paper BTC.
Paper BTC refers to the derivatives contracts related to the cryptocurrency that don’t require users to own any tokens themselves. With Paper BTC gaining more dominance, its influence on the market has become quite apparent.
In the chart, the purple line corresponds to the total BTC exchange inventory; that is, it shows the sum of the Spot and Paper BTC present on the various platforms.
It would appear that while the Spot BTC itself has declined recently, the same hasn’t been true for the combined Spot and Paper BTC supply, which has continued to move sideways. This would imply that Paper BTC is being printed at about the same rate as Spot BTC, which the investors are withdrawing.
A rise in Paper BTC is generally not a good sign for Bitcoin, so it could hinder BTC’s upward push. Woo notes, however, that things could change quickly if a short squeeze occurs in the market.
A “squeeze” refers to an event where a mass amount of liquidations occurs at once, so a short squeeze in particular, would naturally be the occurrence of a mass amount of short liquidations.
“Current demand and supply is neutral bearish, but signs of moving into a bullish structure if we get some liquidations,” says the analyst.
BTC Price
Bitcoin had recovered beyond the $61,000 mark yesterday, but it appears to have slipped up today as its price is now floating around $59,600.
Featured image from Dall-E, woocharts.com, chart from TradingView.com
Keshav is currently a senior writer at NewsBTC and has been attached to the website since June 14, 2021.
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Keshav has been writing for many years, first as a hobbyist and later as a freelancer. He has experience working in a variety of niches, even fiction at one point, but the cryptocurrency industry has been the longest he has been attached to.
In terms of official educational qualifications, Keshav holds a bachelor’s degree in Physics from one of the premier institutes of India, the University of Delhi (DU). He started the degree with an aim of eventually making a career in Physics, but the onset of COVID led to a shift in plans. The virus meant that the college classes had to be delivered in the online-mode and with it came free time for him to explore other passions.
Initially only seeking to make some beer money, Keshav unexpectedly landed clients offering real projects, after which there was no looking back. Writing was something he had always enjoyed and to be able to do it for a living was like a dream come true.
Keshav completed his Physics degree in 2022 and has been focusing on his writing career since, but that doesn’t mean his passion for Physics has ended. He eventually plans to re-enter university to obtain a masters degree in the same field, but perhaps only to satiate his own interest rather than for using it as a means to find employment..
Keshav has found blockchain and its concepts fascinating ever since he started going down the rabbit-hole back in 2020. On-chain analysis in particular has been something he likes to research more about, which is why his NewsBTC pieces tend to involve it in some form.
Being of the science background, Keshav likes if concepts are clear and consistent, so he generally explains the indicators he talks about in a bit of detail so that the readers can perhaps come out having understood and learnt something new.
As for hobbies, Keshav is super into football, anime, and videogames. He enjoys football not only as a watcher, but also as a player. For games, Keshav generally tends towards enjoying singleplayer adventures, with EA FC (formerly FIFA) being the only online game he is active in. Though, perhaps due to being ultra-focused on the game, he is today a semi-pro on the EA FC scene, regularly participating in tournaments and sometimes even taking back prize money.
Because of his enthusiasm for anime and games, he also self-learned Japanese along the way to consume some of the untranslated gems out there. The skill didn’t merely remain as just a hobby, either, as he put it to productive use during his exploration for small-time gigs at the start of COVID, fulfilling a couple of Japanese-to-English translation jobs.
Keshav is also big into fitness, with agility and acceleration-related workouts making a big part of his program due to the relevance they have in football. On top of that, he also has a more traditional strength based program for the gym, which he does to maintain an overall fitness level of his body.
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