Evaluate what the price of Bitcoin will look like in the coming days

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Bitcoin’s movement on the price charts has been quite restrictive lately. Even though the market centerpiece hit $ 50,000 for brief periods in the last three consecutive days, it has not been able to exceed the same value. In fact, BTC was trading at $ 49.8,000 at the time of writing.

Market mood swings

Well, on-chain metrics depicted quite a few interesting trends at the time of writing. To begin with, consider the balance on trade. Now, as shown in the chart below, the trade balance has fallen below its May lows and is currently at the 2018 level. Overall, the depletion of the cumulative trade balance indicates that players market have been buying Bitcoin lately.

Source: Glassnode

Interestingly, the market has seen strong buying cycles from whales. These big market players have added over 41,580 BTC to their HODLings in the past 10 days. When the dots are connected, it becomes pretty clear that the whales have been the backbone of the ongoing shopping spree.

Additionally, the state of most supply shock ratios looked quite attractive at the time of writing. Bitcoin’s illiquid supply shock ratio, for example, had fallen sharply since late August. However, this trend has seen a complete reversal and started its northward movement since September 2.

Source: Glassnode

The foreign exchange supply shock rate and the very liquid ratio have been on the rise since the start of this month. A magnified view of the former indicates that it recovered considerably from its withdrawal in April and May. Overall, this underlines the fact that trade flows are returning to their accumulation mode to cope with rising demand.

As such, a supply shock is an event that triggers a sudden increase or decrease in the supply of an asset. The unforeseen change usually affects the equilibrium price and triggers a change in valuation. The Bitcoin market has seen a handful of supply shocks before this. Oddly enough, in most cases the rapid surge in demand and the parallel drying up of supply have sparked rallies.

Given the rising demand and the state of supply shock ratios, it would be fair to expect prices to rise in the coming days. In retrospect, Bitcoin should be able to record a long green candle on its price charts. Additionally, popular analyst Will Clemente pointed out the same in a recent article. He said,

“Looks like a huge green candle is coming soon for Bitcoin.”

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