After a new all-time high (ATH) of $126,199 on Binance, Bitcoin (BTC) is now consolidating in the low $120,000 range. The latest exchange data – such as the Cumulative Volume Delta (CVD) confirmation score – indicates that BTC is benefiting from strong fundamental demand.
CVD confirmation shows strong demand for Bitcoin
According to a CryptoQuant Quicktake post from contributor Arab Chain, Bitcoin’s CVD confirmation result — a 30-day rolling correlation between Bitcoin price and CVD — indicates a strong trend resynchronization.
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For starters, CVD Confirmation Score measures the 30-day relationship between the price of Bitcoin and the CVD, which tracks the net difference between the recipient’s buy and sell volumes on exchanges. A high score (above 0.7) indicates that price increases are supported by real buying pressure, while a low or negative score indicates weak or speculative momentum.
The latest data from Binance shows that the CVD Confirmation Score is currently hovering around 0.8 to 0.9, indicating that the current price rally is largely driven by genuine buyer buying rather than a technical bounce or short squeeze.
Past data also indicates that when this data point remains at around 0.7 for an extended period, price corrections tend to be relatively shallow and short-lived. This is because the new liquidity in the market quickly absorbs any incoming supply of BTC.
A CryptoQuant analyst noted that if the CVD confirmation result continues to hover above 0.7 – coupled with a decisive break above the $124,000-$126,000 resistance zone – it could be on its way to the resistance level. Potential target Up to $135,000.
However, any negative skew as the BTC price rises and the CVD Confirmation Score drops below 0.4 should be viewed as a warning sign, as it increases the possibility of distribution pressure or liquidation.
On the contrary, $112,000 – $115,000 and $108,000 – $110,000 stand out as strong support levels for Bitcoin. At these price levels, the degree of CVD confirmation must remain constant to ensure the uptrend remains intact. The Arabic series added:
The underlying trend is bullish and supported by real flows on Binance, the world’s largest exchange. Watch for three confirmation signals: CVD confirmation remains high, open interest remains moderate, and funding does not become excessive. Any clear imbalance in these metrics will be the first warning of a shift in momentum.
Is BTC due for a correction?
While bulls are hoping for an extended BTC rally, some analysts believe Not completely convinced About digital assets rising to new highs in the near term. For example, crypto analyst ZVN recently male That BTC may see a pullback before its next rise to $150,000.
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Likewise, fellow cryptocurrency analyst Dick Dundee recently anticipation BTC could see a massive 60% price correction, falling to $43,900. At press time, Bitcoin is trading at $118,791, down 1.8% over the past 24 hours.
Featured image from Unsplash, charts from CryptoQuant and TradingView.com
