Bitcoin is approaching its ATH again
Bitcoin is closing in 6 consecutive days of price appreciation on the daily chart. The last time BTC saw six green candles in a row was in the last week of December 2020. While this may be a key sign of a bullish period for Bitcoin, all metrics have not yet been fully sold on the fact.
In this article, we identified the reasons why Bitcoin is still in the consolidation phase, which in turn also has positive long-term credentials.
Bitcoin and N0n-Aggresive Netflow accumulation
Source: Crypto Quant
Without taking anything away from Bitcoin in terms of momentum, it is important to note that the total net exchange flows are not aggressively one-sided at the moment. During the high in January and February, exchange outflows dominated inflows, although they are much more balanced at the moment.
There is a cyclicality that can also be observed.
When analyzing the graph above, we can see that the market may be reaching a peak in net flows, which may indicate a potential reversal in the current cycle. To be fair, the chart can be estimated from both a bullish and bearish outlook, but the benefit of the doubt would need to go towards a bullish result.
Another reason is also the fact that in recent months, net flows have been negative, which means that a global top has not yet been reached, which could be the case for the possible cycle.
How close are we to the top?
It is difficult to estimate, since several assets remain somewhat pessimistic. According to Santiment, the weighted social sentiment index for Bitcoin is still negative, showing that the overall narrative is still recovering from the February lows.
However, Skew recently reported that Bitcoin is more volatile than Ethereum in terms of the 1-month realized volatility spread, which is rare in itself.
In addition, another neutral sentiment was also noted by the Coin-Days Destroyed chart for BTC.
A higher CDD value is synonymous with a rising bullish on the chart and, currently, the CDD is moderate to low, which is noticeable with daily traffic.
So far, Bitcoin was breaking above $ 56,800, so the rally may see a rebound in the next few hours, but the overall trend is still neutral, so another decline is also likely.