Bitcoin speculators hint at 'local bottom' as buyers target $117.5K

Bitcoin profit-taking may be inadvertently revealing the next "local bottom" for BTC price, new analysis suggests.

Key points:

Bitcoin short-term holders are showing classic profit-taking behavior, sending BTC to exchanges.

Their presence among exchange inflows has reached a level associated with “local bottoms” on BTC/USD.

A popular bid level on Binance now sits at $117,500.

Bitcoin 

BTC$118,606

 may be putting in its next local bottom as retail investors offload profits, new research says.

In a QuickTake blog post released on Wednesday, onchain analytics platform CryptoQuant eyed a key event for BTC price action.

Bitcoin exchange inflows spark new price signal

Bitcoin retail investors are reducing BTC exposure as price hovers around $120,000, CryptoQuant confirmed.

Exchange flows, however, are nuanced; inbound transactions are increasingly coming from newer investors, commonly known as short-term holders (STHs).

“Increased Short-Term Holder (STH) Activity on Binance Signals Potential Profit-Taking,” contributor Amr Taha summarized. 

Taha highlighted the Binance Exchange Inflow Ratio for STHs, which shows the proportion of inbound transactions to Binance coming from entities hodling for six months or less.

The ratio recently crossed 0.4, something Taha shows “often coincides with local bottoms.”

“The latest spike above 0.4 suggests that retail participants may have started depositing their Bitcoin holdings en masse to Binance, likely in an attempt to secure profits following a strong upward price trend,” he said.

“The STH cohort — typically holding BTC for less than 155 days — has a tendency to sell during upward trends, and the current ratio reinforces this behavior.