How does outflow and inflow affects on coin price? 💰💰💰💰
As a crypto trader you should know this to gain success. Let's know it--
Inflow and outflow of a cryptocurrency—usually measured from exchanges—can significantly affect its price. Here's how each works:
🟢 Inflow to Exchanges
Definition: When coins are moved into an exchange from wallets.
Impact: Bearish Signal (Potential Price Drop)
More inflow typically means people are preparing to sell, which can increase supply on the market.
Market Interpretation: Traders might see this as a signal that holders are looking to liquidate.
Selling pressure may rise, pushing the price down.
Example:If 10,000
$BTC is sent to Binance, it could signal that large holders are preparing to sell, leading to a price dip due to increased supply.
🔴 Outflow from Exchanges
Definition: When coins are moved out of exchanges to wallets.
Impact: Bullish Signal (Potential Price Increase)
More outflow usually means people are withdrawing to hold, reducing immediate sell pressure.
Market Interpretation: Investors may be shifting coins to cold storage or long-term wallets.
Lower supply on exchanges often supports price increases.
Example: If
$ETH outflows spike from Coinbase, traders might interpret that as accumulation, possibly driving the price up.
#OUTFLOW #inflows #learn2earn