The cryptocurrency market is currently experiencing a phase of intrinsic trading, as highlighted in a recent assessment by CoinKarma. The publication provides the following information: this shift is attributed to a lack of net inflow of external capital, leading to short-term price movements primarily influenced by internal fund circulation and liquidity.
Emerging Signs of Reversal in Internal Fund Behavior
CoinKarma's analysis reveals that after a period of consolidation, there are emerging signs of reversal in internal fund behavior. Notably, the USDC/USDT premium index has turned positive, indicating that USDC is now trading at a premium over USDT. This shift suggests a significant reduction in selling pressure from major market players, especially within the BTC/USDT pair. Historically, such premium movements have been associated with periods of weak selling pressure in the short term.
Market Liquidity Index as a Crucial Indicator
Additionally, the overall market liquidity index serves as a crucial indicator, reflecting the weighted liquidity levels across the market. CoinKarma points out that the concurrent movement of the USDC/USDT premium index and market liquidity indicators bolsters the likelihood of a bottom formation in the short term. However, despite the increasing potential for a short-term recovery, CoinKarma warns that the medium-to-long-term outlook remains negative, highlighting the risk of persistent market fragility if trend-based selling pressure resurfaces.
As the cryptocurrency market faces intrinsic trading dynamics, established players like Bonk and Floki continue to thrive amidst the rise of new contenders such as APEMARS. For more details, see read more.
