Bitcoin spot trading volume has not shown a significant increase and continued rebound faces resistance

Over the past 24 hours, Bitcoin's gains have slowed. Bitpush terminal data shows that as of press time, the price of Bitcoin is about $47,026, a 24-hour drop of 1.46%. On-chain data shows that Bitcoin's total daily trading volume reached its highest point on March 16, when BTC broke through the $40,000 mark. But after that, spot trading volume did not show a significant increase, but fell back to the three-month average.

"Daily transactions" is a measure of the total amount of Bitcoin changing hands on any given day. When the metric is rising, it means that more tokens are now being traded on-chain. This trend suggests that the market is becoming more active as investors become more interested in cryptocurrencies. On the other hand, a decline in this metric suggests that the Bitcoin network is becoming less active, a trend that could mean that investor interest is declining.

The chart below shows the trend of Bitcoin transaction volume over the past year:

Bitcoin trading volume has seen a small increase over the past seven days. However, despite the increase, the value of this indicator remains low when looking at longer time frames, suggesting that not many traders are currently participating in the network.

During periods of low volume, not many traders buy or sell Bitcoin. However, generally speaking, any large price movement attracts more investors, thus maintaining market momentum. The recent rally that pushed BTC’s price above $47,000 failed to attract any significant volume, so this rally may not be sustainable.

As of 9:00 PM Beijing time on March 29, 2022, the total BTC transaction volume was 145,348 BTC, and the net flow in the past 24 hours was -1.299 billion US dollars.

The purchase of large funds may be the driving force of this rise. Bitpush previously reported that Luna Foundation Guard (LFG) has purchased 5,773 BTC worth $272 million this week. MicroStrategy (MSTR)'s wholly-owned subsidiary MacroStrategy has obtained a $205 million loan from Silvergate Bank, which is collateralized by Bitcoin.

Digital asset trading company GlobalBlock analyzed: "It is understandable that buying pressure on MicroStrategy and Luna Foundation Guard has driven a strong upward trend in the short term."

Jason Deane, chief Bitcoin analyst at Quantum Economics, believes: "MicroStrategy and Terra have paused buying, which may be a simple period of calm, but it may also be a simple consolidation period after an eight-day run. If it is consolidation, these are generally considered bullish indicators because it gives the market time to establish a new base on which further price discovery can be based."

The Bitcoin Fear and Greed Index has entered the "Greed" zone, which indicates bullish sentiment among crypto traders. The index is at its highest level so far this year, but it is still below the highest level of "Extreme Greed" in November last year. This shows that there is room for further improvement in investor sentiment and bulls need to regain momentum to further test the upside. Arcane Research reminds investors: "Market participants should remember that every time we showed the slightest sign of greed this spring, the market pulled us back into a fearful state."

At press time, the price of Bitcoin is hovering around $47,300, up 12% over the past seven days and 26% over the past month.