Low Exchange Supply indicates that a reduced quantity of a particular digital asset is held in wallets controlled by cryptocurrency exchanges. This condition suggests that fewer assets are immediately available for sale on trading platforms. It often reflects a preference among holders to move their assets into personal wallets for long-term storage, reducing potential selling pressure. A diminishing exchange supply can signal a supply squeeze and potential price appreciation.
Context
News outlets and on-chain analysts frequently cite Low Exchange Supply as a bullish indicator for digital asset prices. A consistent reduction in exchange holdings can suggest growing investor conviction and a decreased likelihood of large sell-offs. This metric is closely watched as a gauge of market liquidity and future price momentum.
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