• Bitcoin: Here’s confirmation of BTC’s current trend

  • The Bitcoin community is divided, and for the time being, this is understandable. After recent corrections, the market hasn’t been overly bullish, but the asset remains above the $42,000 mark. The main problem with such a price position is that it gives rise to both bullish and bearish arguments.

    The discussions are further marred by ambiguity, and the general public remains undecided. However, it is difficult to deny that strong bullish signals for Bitcoin have emerged in the last week. And, given their rarity, these are difficult to overlook.

    Is the Stablecoin Supply Ratio back in action?

    For much of 2019, as Tether’s dominance began to rise, the stablecoin supply ratio, or SSR, was emphasized as an important metric in terms of stable assets clearly pumping the market.

    While many speculated that these rallies were signs of manipulation, there has been sound logic behind SSR’s impact over time.

    According to CryptoQuant data, the SSR has now decreased slightly. This means that Bitcoin’s purchasing power has increased. As the chart shows, whenever SSR has fallen, there has been a bullish rally that has invariably leveled off with the ratio.

    At the time of publication, the SS ratio was lower than the range seen in October 2020. Back then, the same was followed by a strong bullish market, which propelled Bitcoin above $20,000 for the first time.

    The only minor caveat to the SS ratio is that as USDT pairs rise, the SSR may be aligned with other altcoins as well. Furthermore, a low SSR value may trigger an altseason at the same time, detracting from Bitcoin’s movement.

    Bitcoin exchange reserves are decreasing.

    Another important indicator to consider alongside the SSR is the decline in Bitcoin exchange reserves.

    Outflows of Bitcoin from exchanges have been a prominent trend in the industry since the March 2020 black swan event. Investors were withdrawing BTCs from exchanges, relieving massive selling pressure and bolstering the HODLing narrative.

    At the time of publication, a similar range had been reached once more. Reserve Bitcoins on all exchanges are currently at the level seen in March-April 2021. It is worth noting that Bitcoin reached its all-time high of $64,000 as a result of the same.

    This is a major bullish signal because when a large amount of BTC is removed from the exchange, the propensity of price moving on the basis of smaller trading volumes increases. It causes a supply shock, which causes a significant rally.

    Are we out of the woods yet?

    Perma-bulls would like to believe so, but bearish turnarounds should never be dismissed until the price has reached another no-return zone. To be fair, Bitcoin is currently more bullish than bearish. As a result, the next few weeks will be critical for the world’s largest digital asset.

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