The recent action of Bitcoin’s prices continued its upward trajectory, with the trading of activities above the score of $ 120,000 in the last 24 hours. The move suggests a persistent bullish momentum after a period of strong decline at the beginning of this week.
While the prices approach the maximum of all time, the chain data are starting to paint a picture of solid transactional support behind the price movement. In particular, analysts began to highlight a divergence between the market value of Bitcoin and its network activity below.
One of these observations comes from the Cryptanal Sunflowr Quant analyst, who shared insights in a recent Post QuickTake that examines the unusual behavior of the Cross Golden NVT indicator.
This metric, generally envisaged to increase in tandem with the price due to its function of ratio between market capitalization and transactions volume, is currently falling, which Sunflowr attributes to a significant increase in chain activity.
Growth on Bitcoin chain suggests the strength of the network below
According to Sunflowr, this reverse correlation between the increase in the BTC price and the fall of NVT Golden Cross may indicate that the current rally is guided more by actual use and real transactions on the bitcoin network rather than by speculative trading.
“A drop in the NVT ratio during an increase in prices implies that the volume of transactions is increasing at a faster pace than market capitalization,” he wrote. “This can be interpreted as a sign that the event is supported by a true economic activity”.
This observation aligns with the wider feeling that healthy growth on chain can serve as a base for more sustainable price increases. If the volumes of the transactions grow organically and not exclusively from the speculation of derivatives, it suggests that the adoption of users and financial utility are contributing to the strength of the price.
Investors who look closely these indicators can find this a favorable environment, although caution remains how other metrics suggest the dynamics of the evolving market.
The rotation of the owner indicates a potential movement in the participation of the market
A separate analysis of the IT tech cryptic analyst sheds light on another dimension of the current market structure of Bitcoin: support behavior.
In a post entitled “Holder Rotation”, IT Tech notes that long -term owners, those who have held BTC for more than 155 days, recently started the net distribution, which means that they are selling more than accumulating.
On the contrary, the short -term owners once again show a net storage behavior, a dynamic often observed in the gatherings of the late stadium. This movement between long -term and short -term owners has historically served as a warning sign.
Similar Handoff were observed in April 2021 and in November 2023, both preceding local peaks or cooling phases. Although this does not necessarily confirm a reversal, it highlights the need to monitor support metrics such as exchange rompers and financing rates.
“It is a classic model of use of expert portfolios, while the new market participants could enter due to the increase in prices,” wrote it Tech.
Foreground image created with Dall-E, Tradingview graphic designer