Is the situation for Bitcoin improving? Recent reserves and net flows indicate a market reversal

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Bitcoin price faces short-term volatility

After a period of steady decline, there has been a significant increase in spot exchange reserves, reflecting an inflow of 20,000 BTC. This increase indicates that more Bitcoin is being deposited into exchanges, which typically suggests an intention to trade or sell.

This behavior may exert further selling pressure on Bitcoin prices, which have fallen nearly 7% in the past two weeks, possibly signaling early signs of short-term volatility.

Meanwhile, the net inflow across all exchanges has turned positive, with a net increase of 15,800 BTC. In contrast to the trend of predominantly negative values in recent weeks, this indicates that inflows to exchanges now exceed outflows.

According to CryptoQuant's analysis, this shift, when combined with the increase in reserves, enhances the likelihood of increased trading activity or investors taking profits.

Although the overall market trend is favorable for accumulation and self-custody, recent changes may reflect an increasing caution among investors, who may be preparing to take profits or brace for potential price adjustments.

Additionally, a report from Bloomberg highlights a key metric for measuring South Korean investors' interest in Bitcoin, which has reached its highest level in four months amid ongoing political turmoil in the East Asian country.

As political crises escalate, trading volume surges

This metric, known as the 'Kimchi Premium,' is used to measure the price gap of Bitcoin on South Korean exchanges Upbit and Coinbase. Recently, this premium has surged to a range of 3-5%, indicating increased demand from South Korean investors.

Reports suggest that South Korea's political situation has been tumultuous, especially following President Yoon Suk-yeol's announcement of a brief and controversial state of emergency earlier this month, which was lifted just six hours later.

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