What does the Coinbase Premium Gap Tell us about Investor Activity?

Analyst Marcus Sotirio With a listed digital asset broker GlobalBlock

Bitcoin is hovering in key areas, so it remains around $ 22,000. As the rally continues, the Bulls want to see a price hold of over $ 21,500 that merges with the 20-day moving average. Since Bitcoin plunged from $ 45,000, this moving average has had six retests and six rejections, with $ 21,500 a must-see price level. If prices fall 60% in four months and then fail to successfully retest and flop the daily trend, this will be a sign of weakness in the market.

As Coinbase Premium Gap has surged to positive values over the past week, there are some signs that the rise may continue. Coinbase Premium Gap is an index that measures the difference between the Bitcoin price of Coinbase and the price of Binance.

This indicator has been negative for several months during the downtrend in the market, indicating that Coinbase’s Bitcoin value is below Binance. However, Crypto Quant data show that Coinbase Premium Gap has surged significantly recently. Since Coinbase is primarily used by US investors, this may indicate that US investors are buying Bitcoin more than in other parts of the world.

It can be inferred that institutional investors are becoming more aggressive buyers because the percentage of institutional investors who use Coinbase is higher than that of Binance. Institutional buying pressure is always a positive sign of bullishness.

While the terrible news is no longer negatively impacting the market, the fact that this indicator has risen may indicate that it could be even better in the coming weeks.