Bitcoin and Ethereum Funding Rates and Exchange Inflows Indicate Intense Selling Pressure
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Bitcoin and Ethereum holders are facing increased selling pressure as evidenced by currency flows and financial rates.
Despite the occasional relief sentiment, the bears have firmly taken control of the market as assets plunged to record lows. Bitcoin (BTC) and Ethereum (ETH) – the two largest cryptocurrencies by valuation – have not been spared from this attack. Additionally, recent data reinforces claims of sell signals from holders of both assets.
On-chain data analytics platform CryptoQuant recently revealed metrics as the macro climate adds to the bearish trend. CryptoQuant analysis confirmed selling pressure, taking into account two crucial indicators.
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– CryptoQuant.com (@cryptoquant_com) 23 September 2022
“Two data sets signaled selling pressure in both Bitcoin and Ethereum this week: Exchange Inflow and Funding Rates,” the analysis stated. The article highlighted the deteriorating macro environment as the Fed expects to raise interest rates to 4.6% in 2023 – a look at the March average forecast of 3.6%.
Apparently, a huge number of Bitcoin and Ethereum tokens have entered the exchanges recently. Usually, investors transfer their holdings to the stock market when they intend to sell them. Thus, the increase in the alternating current tends to pump the downdraft into the atmosphere.
As CryptoQuant BTC Exchange Netflow is currently showing a low value compared to the 7-day average, inflows have generally increased during this period. In addition, BTC reserve on exchanges has seen recent spikes, indicating selling pressure.
with ETH, Exchange Netflow reveals a massive descending sign. Exchanges have recently seen an explosion of ETH flows as the Exchange Netflow remains higher than the 7-day average. CryptoQuant analysis highlighted that these ETH token inflows were observed just prior to the merger.
Also, the derivatives market does not bode well for BTC and ETH. The interest rates on both assets have remained negative, which indicates the willingness of investors to short assets. “Furthermore, as the merger approached, ETH’s financial holdings were at an all-time low.” CryptoQuant analysis added.
In addition to their financial interest ETH Taker buy-sell ratio is less than 1 sign. At 0.96, the ratio indicates a dominant bearish sentiment in the ETH derivatives market.
As for BTC, the Taker Buy Sell Ratio shows an even more dominant bearish sentiment. The current ratio is 0.95, indicating that receivers fill more sell orders than buy orders.
“In addition to the two sets of measurements above, we see an ever-increasing activity from whales sending coins to the exchange, reinforcing the selling pressure.” CryptoQuant concluded.
As macroeconomic conditions continue to deteriorate, risk assets have weakened in the recent battle against the bears. Since cryptocurrencies have recently become entangled with traditional finance, they have not been caught up in this controversy.
BTC and ETH are trading at $18,906 and $1,286 at press time. Nevertheless, ETH has experienced a stronger decline in the past seven days despite the consolidation, as it shed 12.64% of its value. BTC, on the other hand, is down 4.74% in the last week.
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