Bitcoin’s Coinbase Premium Remains Negative: US Institutions Continue to Sell Amid Easing Pressures

Bitcoin has managed to rise above $90,000 after enduring significant selling pressure, providing a brief respite amid market fears. However, the Coinbase Premium Index remains negative, indicating that US institutions are still selling more than retail investors. While institutional selling has cooled off recently, analysts warn that sustained demand is still needed for a stronger recovery.

Key Takeaways

Bitcoin is trading above $90,000, but bulls are still facing challenges.
The Coinbase Premium Index remains negative, showing institutional selling.
Recent selling pressures have eased, but caution remains among analysts.
Bitcoin's recovery efforts face key resistance levels, particularly at the 100-day moving average.

Bitcoin’s Market Situation

Bitcoin recently surpassed the $90,000 mark after facing a wave of selling pressure that had many investors on edge. This resurgence provided a glimmer of hope for a market grappling with uncertainty. Despite this bounce back, market participants remain cautious as speculation about an impending bear market looms. Many investors are still processing the significant decline from October's all-time high, and confidence is not yet fully restored.

Top analyst Darkfost identifies a crucial indication of this cautious sentiment in the Coinbase Premium Index, which is currently negative. This index compares Bitcoin's price on Coinbase, favored by US institutions and professional investors, with Binance, which is commonly used by retail traders. A negative reading indicates that institutional investors and large US players are selling off Bitcoin more aggressively than smaller, retail investors.

Darkfost also points out that ongoing spot ETF outflows contribute to this persistent selling pressure, negatively impacting market sentiment. Although Bitcoin's recent rise above $90K reflects a temporary momentum shift, it needs to show consistent strength to avoid deeper bearish conditions.

Easing Institutional Selling Pressure

Darkfost highlights that since the peak in panic selling on November 21, there has been a noticeable decline in institutional selling pressure from US investors. During the panic phase, the Coinbase Premium Index sharply dropped into the negative zone, indicating that professional traders offloaded Bitcoin much more aggressively than retail investors. This imbalance played a role in pushing BTC toward its recent lows.

Bitcoin Hourly Coinbase Premium | Source: Darkfost

Recently, however, the severity of this selling has begun to ease. Although the Coinbase Premium Index is still negative, it shows less severity than before. Darkfost indicates that while the index has yet to turn positive, the trend is improving. If this pattern continues, it could provide the much-needed breathing room for the market and stabilize Bitcoin’s price action. Analysts emphasize that the upcoming sessions will be crucial; Bitcoin must prove that this easing in selling pressure translates into sustained demand. A decisive move—whether breaking higher or further downward—seems imminent.

Bitcoin’s Recovery Attempts Against Resistance

Bitcoin is making its first substantial effort at recovery after a steep decline that saw its price drop from a high of $126,000 down to the $80,000 range. The 3-day chart indicates that BTC has bounced back sharply from the 200-day moving average (marked in red), which historically serves as significant support during major corrections. This rebound has pushed Bitcoin's price towards the $91,000 area, though the momentum is still fragile.

BTC Testing Key Levels | Source: BTCUSDT chart on TradingView

The chart reveals that Bitcoin is trading below both the 50-day and 100-day moving averages, which have begun to trend downward—an indication of short-term weakness. Until Bitcoin can reclaim these moving averages, especially the 100-day around $103,000, the overall structure remains susceptible to additional downward pressure.

During the recent sell-off, trading volume was significantly higher than during the subsequent bounce, highlighting stronger selling activity than buying. This suggests that the recent upward movement might reflect a temporary relief rather than a confirmed reversal. Nevertheless, rejection wicks below $85,000 indicate clear buyer interest at lower levels. If Bitcoin can maintain a higher low structure and continue closing above the 200-day moving average, positive momentum may gradually be restored.

Overall, Bitcoin's future trajectory depends on how it navigates these critical levels and whether institutional selling pressure can further ease. Featured image from ChatGPT, chart from TradingView.com.