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The data shows that Bitcoin spot trading volumes have remained at elevated values over the past week despite the price generally moving laterally.
Bitcoin Spot Trading volumes have stabilized in excess of 10 billion dollars.
As per the latest weekly report from Arcane Research, usually, the volumes drop when the BTC price starts to range. The “daily trading volume” is an indicator that measures the total amount of Bitcoin being transacted on the Bitwise 10 exchanges on any given day.
Even if the metric represents only the 10 bitwise trades, the indicator can still be used as a decent proxy for the trend in the overall spot market. These platforms also provide the most reliable data from the industry, so the picture they present is more accurate than the assessment of all market data.
Where the value of this measure is high, it means that investors are moving around large quantities on cash exchanges at this time. Such a pattern shows that traders are active in the market at the present time.
On the other hand, low values suggest that one-off BTC exchanges do not currently observe much activity. This kind of trend can be a sign that there isn't a lot of commercial interest in cryptocurrency at the moment.
Now, here is a chart that shows the trend in the 7-day average Bitcoin daily trading volume over the past year:
Looks like the value of the metric has been pretty high in recent days | Source: Arcane Research's Ahead of the Curve - January 31As displayed in the above graph, the 7-day average Bitcoin daily trading volume surged around three weeks ago to values exceeding $10 billion as the price of the asset saw a sharp rally.
It is not uncommon for the spot market to become very active as the price shows a quick action, As a volatile market, this is what motivates many investors to trade. It is also in fact this new business that maintains rallies like these as a large number of active traders are required to support such movements.
There have been some sudden price movements in the past that have not accompanied significant increases in the volume of Bitcoin trade for a significant period of time, and therefore they died naturally after just a brief moment, with the return of the BTC price at a low volatility thereafter.
In addition, trading volumes usually end when price begins to fluctuate and becomes "annoying" to investors. During the previous three weeks, however, it stayed around the same levels above $10 billion, notwithstanding the fact that the value of the cryptocurrency has been blocked in consolidation over the past week.
There is no notable slowdown in market activity could be a positive sign for the upward thrust current of Bitcoin, as it shows that there is still a long way to go before the rally recovers.
At the time of writing, Bitcoin’s price floats around $22,900, up 1% in the last week.
The value of the asset continues to move sideways | Source: BTCUSD on TradingView
