#BTC Supply Squeeze: Exchange Balances Hit Cycle Low, Signaling Reduced Selling Pressure 📉
Bitcoin's exchange balance has reached a new cycle low of just 2.936 million $BTC . This significant metric indicates that a substantial amount of BTC is moving into cold storage rather than being prepared for sale on exchanges. The last time balances were this low was December 17, 2022, following the FTX collapse.
The BTC balance on Binance offers a useful short-term price signal. Since early 2024, four distinct periods of rapid balance increases corresponded with weakening BTC price trends. A sustained decline in this balance, as observed currently, is a necessary precondition for a market rebound. 📈
A deeper look reveals a compelling divergence in investor behavior. Large entities (whales holding >$1M and >$10M USD in BTC) are consistently withdrawing coins to self-custody. Conversely, retail investors (holding <$100K USD) are net depositing BTC onto exchanges, aligning with recent whale accumulation trends. 🐳
This pattern mirrors the consistent outflows seen from major entities during July-August 2021. It contrasts with January-March 2022, which showed mixed entity behavior with some large holders depositing.
With both on-chain and exchange selling pressure simultaneously weakening, and demand's decline slowing, conditions for a price rebound are robust. We believe the current BTC rebound, initiated from recent support levels, has more room to run. Its sustained momentum will depend on shifts in investor sentiment and risk appetite. 🚀
