Can New Bitcoin Rally Keep Up? Low Spot Volumes Say Otherwise | – Bitcoinist

On-chain data shows the Bitcoin spot trading volume hasn’t seen any significant rise recently, suggesting that the new rally may not last for too long.
As per the latest weekly report from Arcane Research, the BTC trading volume hasn’t risen much recently despite the new price rally.
The “daily trading volume” is an indicator that measures the total amount of Bitcoin changing hands on any given day.
When the value of the metric rises, it means more coins are being transacted on the chain now. Such a trend shows that the market is becoming more active as investors find more interest in the crypto.
On the other hand, declining values of the indicator suggest the Bitcoin network is becoming increasingly inactive. This kind of trend may imply that the general interest around the coin is going down.
Now, here is a chart that shows the trend in the Bitcoin Trading Volume over the past year:
Bitcoin Trading Volume
As you can see in the above graph, the Bitcoin trading volume has observed a small increase over the last seven days.
However, despite the increase, the value of the indicator is still quite low historically, suggesting that there aren’t many traders involved in the network right now.
Related Reading | Bitcoin MPI Spikes Up Suggesting Miners May Be Dumping
Usually, whenever the indicator has had low trading volumes, any large move in the price hasn’t lasted long. This is because of the fact that to sustain such moves, you need a lot of traders in the market.
During periods of low Bitcoin volumes, there aren’t many traders buying and selling. However, generally any big price move attracts more investors on its own, thus keeping itself fueled.
But since the latest rally that has taken the price of BTC above $47k has failed to attract any significant trading volume, it may not be able to keep going for long.
Related Reading | Another Crypto Scam: Former Party Producer Charged In $2.7 Million ‘Cash-To-Bitcoin’ Plot
That said, things could very well change in the coming days as they have already done a few times in the past, and high activity could once again return to the network.
At the time of writing, Bitcoin’s price floats around $47.2k, up 12% in the past week. The below chart shows the trend in the price of the coin over the last five days.
Bitcoin Price Chart
For updates and exclusive offers enter your email.
Loves to write, enthusiastic about cryptocurrency. Currently studying Physics at university.
Bitcoin news portal providing breaking news, guides, price analysis about decentralized digital money & blockchain technology.
© 2021 Bitcoinist. All Rights Reserved.