- Bitcoin is hovering around $97,000 on Friday after erasing Thursday’s pre-Christmas gains.
- On-chain metrics show an increase in acquirer buying volume and an increase in stablecoin deposits on Binance.
- A BTC price recovery is likely as US spot Bitcoin ETFs break a streak of outflows and the amount of Bitcoin invested rises.
The price of Bitcoin (BTC) is hovering around $97,000 on Friday, erasing most of the gains from earlier this week, as the biggest cryptocurrency missed the so-called Santa Claus rally, the surge in prices before and just after Christmas.
On-chain BTC metrics offer hope for a recovery as they show increased buying pressure on centralized exchanges.
Bitcoin is driving a price recovery with a resurgence of institutional interest
Experts believe that capital inflows into spot exchange-traded funds (ETFs) are a key driver of token price growth in 2024. Institutional investor interest in Bitcoin returned on Thursday after several days of net outflows from ETFs.
Data from Farside Investors showed net inflows of $475.2 million to unveil Bitcoin ETFs on Thursday, snapping a four-day streak of outflows ahead of the Christmas holiday. The revival of institutional interest suggests greater demand for BTC.
Bitcoin ETF flows. Source: Farside Investors
Following the market-wide Christmas drop, analysts at chain intelligence monitoring platform Santiment have noted an increase in whales transferring stablecoins to exchanges. Stablecoins are typically used by crypto traders to fiat on/off-ramp on centralized exchange platforms.
The increase in the influx of stablecoins into exchanges likely represents demand for cryptocurrencies, indicating increased “buying pressure” for Bitcoin.
The Santiment feed dashboard identified seven different stablecoin deposits on Binance, the largest centralized cryptocurrency exchange platform, in a 24-hour time frame. Each deposit was worth at least $9 million, and the largest was estimated at $50 million.
Analysts saw the move as demand for new altcoins listed on the stock exchange, as well as for Bitcoin. Such moves could mean whales are about to buy Bitcoin, which is considered a bullish sign.
After the post-Christmas market slump, crypto markets are seeing an encouraging trend of stablecoins moving to exchanges. According to @santimentfeed the ultimate CEX deposit dashboard, there were 7 different ones @binance deposits worth at least $9 million in the last 24… pic.twitter.com/XpAn0BvrhM
— Santiment (@santimentfeed) December 27, 2024
Taker’s buying volume indicates buying pressure on Bitcoin
The User Purchase Volume metric provided by CryptoQuant measures the level of demand for BTC on a particular exchange platform. An increase in receiver buying volume could signal increased interest among traders and increasing buying pressure, which is positive for prices.
As for Bitcoin, taker buying volume on Binance trended upward between November 1 and December 25, forming more lows and indicating increased buying pressure.
Bitcoin: Taker buy on Binance. Source: CryptoQuant
Despite the encouraging metrics on the chain, the technical indicators on the daily price chart do not support the bullish thesis for BTC.
The Relative Strength Index (RSI) is mostly stable near the neutral level of 50, indicating indecision among investors. Meanwhile, the Moving Average Convergence Divergence (MACD) indicator is flashing red histogram bars below the neutral line, implying that the Bitcoin price trend has underlying negative momentum.
In case the recent correction continues, Bitcoin could find support first at $92,500, a key support level since mid-December, and then at the November 18 low of $89,376.
BTC/USDT daily price chart
A daily close of the candle above the resistance at the $100,000 milestone could invalidate the bearish thesis. In such a scenario, BTC could retest its all-time high of $108,353.
