Market Analysis of Bitcoin Shows Bulls Are in Control

  After ranging for 3 months and touching the $45,000 level resistance four times, Bitcoin gave a relief bounce. Bitcoin has finally come out of the range and broke the $45,000 level with a bullish candle close. During this range, the market was impacted by a lot of macro factors such as the Russia-Ukraine War, financial sanctions on Russia, which resulted in a high rise in prices of commodities and the FED also approved a 0.25 percentage point hike rate. After all of these factors played out, which were bad for the economy, Bitcoin stayed within the range and always showed strong price movement upwards after some relief in the market. Such strength shown by Bitcoin during such bad times is impressive. I have analyzed some charts below which are composed of On-chain data, Derivatives data and it will be interesting to see whether these charts are showing signs of bullishness or bearishness in the market. Insights gathered from these charts will be helpful to know the upcoming trend in the market. Please remember that this article aims to help you understand the current market scenario. Never invest more than you can afford to lose, and always do your own research before investing.    Exchange Netflow For the past 2 months, Exchange Netflow has been mostly negative, despite the market being highly volatile amid the Russia-Ukraine war. It means more Bitcoins are going out of exchanges during these times despite such bearish macro conditions. This shows that people are confident in Bitcoin’s value and are moving their Bitcoin into their wallets. This data also shows that there is low selling pressure on exchanges for Bitcoin. It is positive for the overall health of the market.   Bitcoin Spot & Futures Demand There has been no major change in the number of Bitcoin holders. The number of Bitcoin holders in January and in March is almost the same, while Bitcoin Futures have risen in the past few days as Bitcoin was moving up towards resistance at the $45,000 level. Bearish sentiment in the worldwide market has not frightened the Bitcoin holders as there is no major change in the number of Bitcoin holders, which is quite bullish for the market in terms of people’s conviction towards Bitcoin irrespective of its current price value. Open Interest Open Interest has continually increased for the past 2 months and currently, 14.494 billion dollars worth of derivative positions are opened. A continuous increase in Open Interest is usually an invitation to volatility in the market. Bitcoin has finally broken out of this range, this might attract more open interest positions being opened. It’s possible that we will see major liquidations in the coming weeks if volatility in the market increases. Put/Call Ratio Before talking about this chart, it is important for you to know what is “put” and “call”. A “put” or put option is a right to sell an asset at a predetermined price. A “call” or call option is a right to buy an asset at a predetermined price. As you can see, more call positions are opened right now in comparison to Puts, it shows the bullish sentiment of the market toward Bitcoin.   Short Term Holder Realized Price   The Short-Term Holder Realized Price can act as a major resistance for Bitcoin, trading at $45.9k. As this metric is the average price paid for Bitcoin by investors who purchased after the October ATH. If short-term holders did not feel confident about Bitcoin, they might sell their positions which can result in a major fall in Bitcoin price. If Bitcoin holds above the $46,000-$47,000 level easily without much problem, then Short-Term Holders might not feel any panic to sell their bags, and it will not result in high selling pressure.  All the data simply tells us that market conditions are positive and bulls are in control right now. After three months of ranging, we might see the market in uptrend soon, considering no major negative change takes place in the macro-environment. However, if we go upwards, high volatility is expected to shake out the weak hands. As the market does not give gains easily to market participants.  Bitcoin is still more then 30% below its all-time high, and the Russia-Ukraine war is still going on. Any major negative news can result in a major downfall in Bitcoin price. So, it is time to be cautiously bullish, not highly bullish. But if there is no such news, seeing the current bullish sentiment, we might see many green candles on the Bitcoin chart in the month of April

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