The Bitcoin Balance on Exchanges are the amount of Bitcoins that are being held on exchanges. We are tracking various exchanges wallets to determine the balance on the most biggest exchanges. This metric can be very helpful in showing the underlying behaviour of investors and traders.
The Bitcoin balance on exchanges can help us determine the amount of potential selling or buying pressure for Bitcoin. If the Bitcoin balance on exchanges is rising, it means that investors and traders are sending their Bitcoins to exchanges which could mean they have an intention to sell their Bitcoin and thus create selling pressure. We often see that right before Bitcoin is starting to sell oﬀ, Bitcoins are being send to exchanges. It works the other way around as well, when Bitcoins are leaving the exchanges it means that investors and traders are accumulating. Therefor less bitcoin are prone to selling as they are not sitting in exchange wallets.
Find more information in our learning section on how to use the Bitcoin balance on exchanges for trading.