Since Bitcoin reached its all-time high of $122,920 on Monday, its price has moved sideways, reflecting a slowdown in market momentum.
This calm price performance comes as many traders take profits after the recent rise, while on-chain indicators suggest a decline in the appetite of investors residing in the United States.
The rise in BTC price has stopped as American investors retreat.
On-chain data shows a significant decline in trading activity among American participants over the past week. This increases the risk of an extended consolidation phase or even a short-term correction.
According to data from CryptoQuant, the Coinbase Premium Index (CPI) for BTC has steadily declined over the past week, indicating a decrease in buying interest from investors residing in the United States.
According to the data provider, this closed at a seven-day low of -0.017 yesterday.
This indicator measures the difference between BTC prices on Coinbase and Binance and serves as a reliable gauge of American investor sentiment.
When CPI rises, BTC trades at a premium on Coinbase compared to international exchanges, indicating stronger buying pressure from investors residing in the United States.
Conversely, when it declines or turns negative, it indicates that demand on Coinbase is lagging behind global markets due to profit-taking or diminished interest among American buyers. This is currently the case, as low demand from American investors may be contributing to the sideways movement of the coin after it reached its peak two days ago.
Furthermore, this cold sentiment has also been reflected in the decrease in instant flows to BTC-backed ETFs since the beginning of the week.
According to SosoValue data, while BTC-backed funds have maintained positive net flows since Monday, the volume of these flows has been steadily declining.
This indicates a modest but noticeable decline in institutional participation.
Minimum $118,000 or maximum $122,000?
These trends suggest that the aggressive buying wave seen during the recent Bitcoin rise may be losing momentum. If this continues, Bitcoin's decline could extend to $118,851.
However, if sentiment improves among investors residing in the United States and they increase their accumulation of coins, the price of Bitcoin could resume its bullish trend and revisit its all-time high.