Bitcoin Net Taker Volume Finally Flips Positive — Why This Shift Matters

[Ben Graham]

The price of Bitcoin began the new week on an exciting move to the upside. The premier cryptocurrency recorded a price ascent of about 9%, reaching a high of over $97,000 and falling just short of its past six-figure valuation. Interestingly, a recent on-chain revelation shows that an underlying change was simultaneously taking place as the price of Bitcoin soared on the charts.

Are The BTC Bulls Back In Control?

In a January 16 post on social media platform X, crypto analyst Darkfost revealed a notable shift in the on-chain power dynamics, saying that the bulls are seemingly back in control.

The relevant indicator here is the BTC Net Taker Volume, which tracks which of the buyers or sellers is more aggressive in the market. The metric does so by measuring the net difference between buy and sell market orders executed on derivatives exchanges.

Before this recent shift, the net taker volume had fallen into deep negative territory, reaching a bottom of about –$489 million. Due to the lack of demand in the market over that period, the price of BTC continued to fall as selling pressure grew. However, this market scenario has shifted, as of Friday, January 16th.

The Bitcoin Net Taker Volume now records a positive reading, with more than $39 million in buy-side volume from the futures market. This means BTC traders are becoming increasingly interested in opening long positions — and aggressively at that. 

Historically, an increasing buying interest among participants of the futures market typically signals rising bullish sentiment. In turn, upward price pressure increases through leverage, leading to amplified short-term price moves if sustained.

Bitcoin Market Outlook

Darkfost further explained that, although there are signs that Bitcoin ETF inflows might be picking up slightly, it remains that spot buying is yet to gain enough strength to sponsor a decisive bullish move. As a result, all eyes fall on derivatives activity, as it currently serves as support for the Bitcoin price.

Ultimately, the present scenario is best interpreted as the end of bearish pressure, rather than a blatant structure shift. However, in the event that net taker volume continues to grow positively, the narrative could shift from dwindling bearish pressure to mounting bullish momentum.

Till then, market participants are advised to deal cautiously until it is confirmed that the derivatives-sponsored momentum is sustainable for the flagship cryptocurrency’s growth.

As of press time, the price of Bitcoin stands at about $95,357, with insignificant movement over the past day. 

Featured image from iStock, chart from TradingView