Key Points
- Bitcoin’s Inter-Exchange Flow Pulse (IFP) has turned negative, indicating a potential market downturn.
- Bitcoin’s weak momentum and resistance at $98,815 suggest potential downside risks.
The market dynamics of Bitcoin (BTC) have recently displayed bearish tendencies. The Inter-Exchange Flow Pulse (IFP), a key metric that monitors BTC movements between spot and derivative exchanges, has turned negative. This shift in the past has indicated a decrease in risk appetite among traders, often leading to a drop in price.
Bitcoin’s Bearish Indicators
The IFP tracks the net flow of Bitcoin between spot and derivative exchanges, offering insights into market sentiment and positioning. A negative shift could imply that traders are closing positions, deleveraging, or preparing to sell. This has historically been linked with periods of increased selling pressure and potential price drops in Bitcoin’s market cycle.
Negative IFP readings have in the past aligned with market corrections or extended bearish phases. For instance, the metric turned negative in early 2018, aligning with Bitcoin’s decline from its cycle peak into a year-long bear market. Likewise, in mid-2021, the IFP turned negative ahead of a significant drop, as traders cut leverage and exited positions.
Bitcoin’s Struggle for Momentum
Bitcoin is currently finding it difficult to gain upward momentum, trading around $97,605 at press time. Key technical indicators suggest a cautious outlook. The 50-day SMA at $98,815 is acting as immediate resistance, while the 200-day SMA at $80,002 remains a crucial long-term support level. The RSI is at 46.88, below the neutral 50 level, indicating weak buying pressure.
The MACD is still in negative territory, with the signal line below the MACD line, reinforcing bearish sentiment. If Bitcoin fails to reclaim the 50-day SMA, a drop toward $95,000 or lower could be possible. Conversely, a breakout above $100,000 is needed to nullify the current bearish bias and reignite bullish momentum.
