Bitcoin Risks Deeper Price Pullback as Exchange Inflows Spike

Bitcoin BTC$84,459.46 may soon extend Wednesday's price pullback, according to a data metric that suggests there's increased selling pressure in the market.

• While the top cryptocurrency by market value fell by 4% on Wednesday, it defended the long-held support zone of $11,100–$11,200.
• Exchange platforms witnessed an inflow of 92,000 BTC on Wednesday, the biggest-single day rise in 37 days, according to blockchain intelligence firm Chainalysis.
• "Inflows surged as people rushed to sell at near $12,000," Philip Gradwell, chief economist at Chainalysis, tweeted early Thursday.

• Gradwell believes the selling pressure (arising from the exchange buildup of 92,000 BTC) has probably not been fully absorbed yet.
• That's because bitcoin's median trade intensity, which measures the number of times an inflowing coin is traded, remained low at 3.113, well below the 180-day average.
• Put simply, there were not enough buyers to match sellers.
• As such, coins that weren't liquidated yesterday could still be offloaded into the market in the short run, causing a more profound price decline.

• "I think there is still sell pressure to work through," Gradwell said.
• Bitcoin is currently trading near $11,300, representing a 0.7% decline on the day.
• As discussed Wednesday, a violation at immediate support at $11,170 would confirm a bearish reversal pattern on the technical charts.

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