Bitcoin has continued to experience volatility after the long-awaited halving event, with prices continuing to wobble. Despite the sideways movement, however, analysts remain optimistic about bitcoin’s price action in the current market cycle.
According to an analyst from the blockchain analytics platform CryptoQuant, the Coinbase Premium trend could have a positive effect on bitcoin’s price once it turns negative.
The Coinbase Premium Index is an indicator that represents the percentage difference between the BTC/USDT pair on Binance and the BTC/USD pair on Coinbase Pro. Since Binance has a global user base while Coinbase is more focused on the US market, the difference between the prices on these two large crypto exchanges provides insight into the trading behaviors of both demographics.
Coinbase Premium Index Close to Zero
When the Coinbase Premium displays a positive trend, it indicates that bitcoin’s price on Coinbase is higher than on Binance as there is greater buying pressure on the former. However, a negative trend suggests that Coinbase is seeing a greater selling pressure, as the price listed on Binance becomes higher.
Per the analysis from CryptoQuant, historical data indicates that bitcoin’s price typically rebounds when the Coinbase Premium trend is negative and reverses from a downtrend to an uptrend. One such occasion was when Grayscale won the lawsuit against the SEC regarding the conversion of its GBTC product to a spot Bitcoin ETF, and it positively affected BTC’s price.
The Coinbase Premium Index is currently hovering in the positive zone, close to zero. However, if the trend shifts to negative, bitcoin’s price is expected to rebound.
“If the historical pattern repeats itself, we may have a better chance of success if we wait a bit longer and invest in the rebound after the trend turns negative,” the analyst said.
Accumulation Continues Amid Price Fluctuations
Bitcoin has continued to see increased interest from investors despite price fluctuations. The latest approval of several spot Bitcoin ETFs have further improved inflows into the market.
Earlier this month, Coinbase released its Q1 earnings report, with the total revenue surging 72% to $1.6 billion.
The post Historical Data Shows Bitcoin Price Could Rebound Soon If This Happens: CryptoQuant appeared first on CryptoPotato.