A blockchain indicator that tracks the flow of crypto assets into and out of centralized exchanges points to a bearish trend in investor sentiment, similar to that seen before the May 2021 crash.
Data from Glassnode shows that the 90-day moving average of net crypto asset flows has turned positive, meaning that the amount of coins entering the exchanges is greater than the amount leaving the exchange.
Continuing net inflows, if any, will be a cause for concern for the bulls.
Net inflows express an investor’s intent to sell, while consistent outflows take the circulating supply from the market and key data representing strong long-term investment sentiment, paving the way for price increases.
The 90-day average net flows turned positive on May 13, 2021, after which Bitcoin plunged sharply from $50,000 to $30,000, stopping the decline by hitting record highs above $64,000.
Metric, bitcoinIt signaled exits with sustained negative pressure throughout the ‘s 10x rally above $60,000 observed from 11 months to April 2021.
A similar model in October 2021 BTCIt was observed when . It was most recently traded near $47,100, largely unchanged on the day. It has been capped at $45,500 to $52,000 since early December.
The Federal Reserve’s December meeting minutes and US jobs data scheduled for release this week could add volatility to the Bitcoin market.
According to FXStreet, the US economy is expected to add 400,000 jobs in December, after 210,000 additions in November. Strong data could strengthen the dollar and the weight on Bitcoin and asset prices in general.
Disclaimer: What is written here is not investment advice. Cryptocurrency investments are high-risk investments. Every investment decision is under the individual’s own responsibility. Finally, Koinfinans and the author of this content cannot be held responsible for personal investment decisions.