<span style="font-weight: 400">Bitcoin has been ranging between $37,000 and $45,000 price level for the past two months, while most altcoins are bleeding and are in a clear downtrend. Liquidity is very low in the cryptocurrency market, due to uncertainty in the market right now. Inflation in the US has reached a 40-year high of 7.9%. FED will be tightening the monetary policy to bring inflation back down. <a href="https://www.cryptoknowmics.com/news/crypto-exchanges-in-a-tough-spot-amid-russia-ukraine-conflict/">Russia-Ukraine war</a> is causing a negative impact on the cryptocurrency market as well as the stock market, due to the uncertainty caused by it. As no one knows how this war will end and what will be the repercussions of it. Therefore, there are a lot of factors that have caused the fall in the prices of cryptocurrencies.</span>

<img class="alignnone wp-image-229713 size-large" src="https://www.cryptoknowmics.com/news/wp-content/uploads/2022/03/bitcoinmo1-1024x582.png" alt="Bitcoin Market" width="1024" height="582" />

<span style="font-weight: 400">This article will cover the on-chain analysis of Bitcoin and with the help of various on-chain data, we will try to understand what is happening in the Bitcoin network, that may result in bullish or bearish price movement.</span>
<h2><strong>Bitcoins in Exchange Reserve</strong></h2>
<img class="alignnone wp-image-229714 size-large" src="https://www.cryptoknowmics.com/news/wp-content/uploads/2022/03/exchange-reserve-1024x529.png" alt="Exchange Reserve" width="1024" height="529" />

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<span style="font-weight: 400">In the last 2 months, Bitcoins held in Exchange Reserve are continually decreasing and have decreased from 2.38 Million to 2.312 Million. This shows that fewer coins are available on the exchanges for trading. If this outflow of Bitcoin from exchanges continues, we might see high volatility in the market in the upcoming days, due to the low liquidity created by these outflows. A decrease in Exchange Reserve indicates the scarcity of Bitcoins on the Exchanges, which is bullish for the Bitcoin market, as it creates low selling pressure.</span>
<h2><strong>Miners’ Position Index</strong></h2>
<img class="alignnone wp-image-229715 size-large" src="https://www.cryptoknowmics.com/news/wp-content/uploads/2022/03/bitcoin-mpi-1-1024x566.png" alt="" width="1024" height="566" />

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<span style="font-weight: 400">On 15 February, Miners’ Position Index value was -0.61, which is very low. It means miners are sending their coins to exchanges very little than usual. This indicates that they are less involved in selling. Miners’ position index value has remained below 1 in the past few months. This shows that miners are not behind Bitcoin selling in the past few months. If Miners’ Position Index is low, it means Miners are holding their Bitcoins, which is likely Bullish.</span>
<h2><span style="font-weight: 400">Open Interest  </span></h2>
<img class="alignnone wp-image-229716 size-large" src="https://www.cryptoknowmics.com/news/wp-content/uploads/2022/03/oi2-1024x553.png" alt="Open Interest" width="1024" height="553" />

<span style="font-weight: 400">Open Interest is steadily increasing over the past few days. Currently, 11 Billion dollars worth of derivatives positions is open. An increase in open positions usually indicates increased volatility. </span>

<span style="font-weight: 400">Bitcoin price is ranging between $37,000 and $45,000 for the past 2 months. We can finally expect this range to be broken. If the increase in open interest causes volatility in the market. This range might get broken, and a breakout is possible.</span>
<h2><strong>Funding Rate</strong></h2>
<img class="alignnone wp-image-229717 size-large" src="https://www.cryptoknowmics.com/news/wp-content/uploads/2022/03/fundingrate1-1024x524.png" alt="Funding Rate" width="1024" height="524" />

<span style="font-weight: 400">The funding rate is currently positive, these rates indicate that long position traders are dominant and are willing to pay funding to short traders. It implies that traders are more bullish right now.  Currently, the open interest positions are increasing and the funding rate is positive, which means that traders are bullish and trading with big amounts. </span>

<span style="font-weight: 400">Currently, No data from the on-chain analysis shows any bearish sign. Miners have a large number of Bitcoins that are not selling much, which is beneficial for the bulls. Most indicators show bullish movement in price in the upcoming days. Bitcoins in Exchange Reserves are decreasing, open interest positions are increasing, and the funding rate is positive. These are all signs of bull's aggressiveness in the market. A slight positive change in the macro environment can act as a bullish catalyst for the market.</span>

On-chain Analysis Shows Signs Of Bullish Trend for Bitcoin

No indicator of the on-chain analysis shows any bearish sign. Miners have a large number of bitcoin are not selling much, which is beneficial for the bulls.

Yash completed his graduation in b.tech (Computer Science ). Yash is passionate about applications of blockchain technology. Yash believes use of blockchain technology can transform our lives at a large scale. Yash daily reads articles, research reports and also  documentation of different protocols. Yash listen to podcasts to know the view of industry experts.

On-chain Analysis Shows Signs Of Bullish Trend for Bitcoin

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