Market Uncertainty Rises As Bitcoin (BTC USD) Sentiment Enters Neutral But…

Bitcoin (BTC USD) price dropped below $110,000 this week, and this is the first time it has occurred since late July.

Meanwhile, Bitcoin sentiment improved slightly from fear as observed last week, but it rested in neural at the time of observation.

The neutral Bitcoin sentiment underscored the uncertainty around the next Bitcoin price move. Will the king of the currency extend its bearish price action, or is another strong bounce back on the cards this time?

The 30-day moving average taker buy/sell ratio may offer insights into which side Bitcoin sentiment may tilt in the coming days.

According to CryptoQuant, the ratio’s 30-day moving average recently adopted a sharp decline.

According to the chart, the taker buy/sell ratio’s moving average dropped to levels last seen in May 2018. Previous dips were accompanied by major price pullbacks.

As a result, this latest pullback raised concerns that Bitcoin (BTC USD) price may embark on more downside. Interestingly, this comes days after Peter Schiff warned that BTC may slide below $80,000.

Weak Demand Underscores More Downside Risk for Bitcoin Price Action

Recent market data demonstrated weak demand for Bitcoin despite its recent price dip.

Large order book data on Coinglass revealed that spot flows on Binance and OKX were still negative in the last 2 days. Coinbase did however register some demand worth about $5 million.

In other words, whale activity did not demonstrate a rush to buy the dip. There were also some reports indicating that some long term holders were taking profits.

Although weak demand underscored the possibility that Bitcoin could slide lower, ETF flows signalled the possibility of a recovery.

Bitcoin (BTC USD) registered sustained spot outflows since mid-August, but recent market data revealed that it kicked off this week with some ETF inflows.

Bitcoin spot inflows on amounted to £307.2 million on Monday and Tuesday.  This signalled that institutions were testing the waters especially after the recent price dip.

Interestingly, the return of positive institutional flows also coincided with a cool down in sell pressure.

In other words, Bitcoin (BTC USD) was on the fence as far as its next move was concerned, with weak demand and weak sell pressure underpinning the neutral sentiment.

Where does Bitcoin (BTC USD) Go From Here?

There’s no doubt that Bitcoin’s latest pullback was characterized by FUD and concerns about more potential downside.

Moreover, the fact that long-term holders have been reportedly offloading some of their coins contributed to the FUD.

However, every major pullback from north of $100,000 resulted in significant accumulation.

Moreover, major institutional players such as Strategy and Metaplanet have been buying Bitcoin aggressively after every pullback, consequently leading to limited retracements.

The same institutional players have been hinting that they were preparing to buy more BTC. Also, the market has been hoping for rate cuts, which could lead to more liquidity inflows into cryptocurrencies.

However, this did not necessarily mean that Bitcoin was safe from more downside in the short term. The latest pullback saw a significant spike in liquidations.

Bullish expectations may lead to more long liquidations, which may end up forcing lower prices. And then there is the elephant in the room, the taker buy-sell ratio’s moving average, which underscores bearish FUD.

On the other hand, discounted price levels will eventually attract yet another wave of buying pressure.

If institutions like Metaplanet and Strategy embark on more buying, then they could trigger the next bullish wave for Bitcoin (BTC USD).