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Breaking News: Trump Prepares To Allow Crypto Investments In $9 Trillion Retirement Market

This Bitcoin Volume Signal Nailed The Top & Bottom: Analytics Firm

Keshav Verma
Keshav Verma
2 hours ago
2 mins read
Bitcoin

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On-chain analytics firm Santiment has revealed how the two largest spikes in trading volume coincided with recent buying and selling windows for Bitcoin.

Trading Volume May Signal Tops & Bottoms For Bitcoin

In a new post on X, Santiment has talked about a pattern associated with the trading volume of Bitcoin. The “trading volume” here refers to a metric that keeps track of the total amount of the cryptocurrency that’s becoming involved in trading activities on the various centralized exchanges.

When the value of this metric is high, it means the traders are making a large number of moves on the market. Such a trend suggests interest in the asset is high. On the other hand, the indicator having a low value implies investors may not be paying much attention to the cryptocurrency as they are participating in a low amount of activity.

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Now, here is a chart that shows the trend in the trading volume for Bitcoin and other top coins in the sector over the last few months:

Bitcoin Volume
Looks like the BTC volume spiked high earlier in the month | Source: Santiment on X

In the above graph, Santiment has highlighted two large spikes in the trading volume of Bitcoin. The first of these, involving a movement of $84.08 billion in the asset, occurred at the start of April. Interestingly, this spike coincided with BTC’s tariff-driven dip. The other spike took place just earlier this month and saw the indicator hit a high of $90.90 billion. This time, the elevated trading volume came alongside BTC’s new all-time high (ATH) above the $124,000 level.

“Note that the two largest volume spikes from Bitcoin signaled the optimal time to buy (as prices were falling) and sell (as prices peaked to a new ATH),” explains the analytics firm.

What could be the explanation behind the pattern? Generally, the higher the trading activity, the more likely BTC is to observe some kind of volatility. This is because the moves being made by investors act as fuel for price moves.

Where the emerging volatility may lead the asset is hard to say based on the trading volume data alone, as it doesn’t separate between buying and selling moves. Spikes that come near price lows, however, can be signs of buying. This is what happened in April. Similarly, a particularly sharp uptick in activity after rallies, like the one seen earlier in the month, can be a sign of profit-taking.

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At present, Bitcoin trading volume remains elevated, but its current value of $66 billion is clearly still a step below the levels seen during the aforementioned turnarounds.

BTC Price

Bitcoin has been facing sustained bearish momentum recently as its price has gradually been sliding down, with its latest value coming at $113,000.

Bitcoin Price Chart
The price of the coin appears to have gone down over the last few days | Source: BTCUSDT on TradingView
Featured image from Dall-E, Santiment.net, chart from TradingView.com
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Keshav Verma
Keshav Verma

Keshav Verma

Keshav is currently a senior writer at NewsBTC and has been attached to the website since June 14, 2021.

Read more

Keshav has been writing for many years, first as a hobbyist and later as a freelancer. He has experience working in a variety of niches, even fiction at one point, but the cryptocurrency industry has been the longest he has been attached to.

In terms of official educational qualifications, Keshav holds a bachelor’s degree in Physics from one of the premier institutes of India, the University of Delhi (DU). He started the degree with an aim of eventually making a career in Physics, but the onset of COVID led to a shift in plans. The virus meant that the college classes had to be delivered in the online-mode and with it came free time for him to explore other passions.

Initially only seeking to make some beer money, Keshav unexpectedly landed clients offering real projects, after which there was no looking back. Writing was something he had always enjoyed and to be able to do it for a living was like a dream come true.

Keshav completed his Physics degree in 2022 and has been focusing on his writing career since, but that doesn’t mean his passion for Physics has ended. He eventually plans to re-enter university to obtain a masters degree in the same field, but perhaps only to satiate his own interest rather than for using it as a means to find employment..

Keshav has found blockchain and its concepts fascinating ever since he started going down the rabbit-hole back in 2020. On-chain analysis in particular has been something he likes to research more about, which is why his NewsBTC pieces tend to involve it in some form.

Being of the science background, Keshav likes if concepts are clear and consistent, so he generally explains the indicators he talks about in a bit of detail so that the readers can perhaps come out having understood and learnt something new.

As for hobbies, Keshav is super into football, anime, and videogames. He enjoys football not only as a watcher, but also as a player. For games, Keshav generally tends towards enjoying singleplayer adventures, with EA FC (formerly FIFA) being the only online game he is active in. Though, perhaps due to being ultra-focused on the game, he is today a semi-pro on the EA FC scene, regularly participating in tournaments and sometimes even taking back prize money.

Because of his enthusiasm for anime and games, he also self-learned Japanese along the way to consume some of the untranslated gems out there. The skill didn’t merely remain as just a hobby, either, as he put it to productive use during his exploration for small-time gigs at the start of COVID, fulfilling a couple of Japanese-to-English translation jobs.

Keshav is also big into fitness, with agility and acceleration-related workouts making a big part of his program due to the relevance they have in football. On top of that, he also has a more traditional strength based program for the gym, which he does to maintain an overall fitness level of his body.

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Disclaimer: The information found on NewsBTC is for educational purposes only. It does not represent the opinions of NewsBTC on whether to buy, sell or hold any investments and naturally investing carries risks. You are advised to conduct your own research before making any investment decisions. Use information provided on this website entirely at your own risk.

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Reason to trust

Strict editorial policy that focuses on accuracy, relevance, and impartiality
Created by industry experts and meticulously reviewed
The highest standards in reporting and publishing
How Our News is Made

Strict editorial policy that focuses on accuracy, relevance, and impartiality

Ad discliamer

Morbi pretium leo et nisl aliquam mollis. Quisque arcu lorem, ultricies quis pellentesque nec, ullamcorper eu odio.

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