31 October 2024
Bitcoin on-chain activity is gaining momentum as a CryptoQuant analyst, known as ‘Yonsei Dent,’ recently pointed to a potential golden cross within the active addresses metric.
This indicator tracks the number of unique addresses engaging with the Bitcoin network, providing insights into the network’s overall activity, investor involvement, and possible market directions.
Golden Cross On Bitcoin Active Addresses
According to Dent’s analysis, applying a monthly and annual moving average to this number of active addresses metric could indicate a shift toward bullish momentum. A high number of active addresses generally suggests strong participation, while fewer addresses may indicate reduced interest.
Dent noted that when the 30-day moving average of active addresses crosses above the 365-day moving average—a phenomenon known as a “golden cross”—it often correlates with upward price momentum in the Bitcoin market.
This alignment between short-term and long-term trends can suggest renewed interest among both retail and institutional investors, which could potentially sustain or even increase Bitcoin’s value.
Furthermore, the concept of the golden cross in active addresses is significant in light of previous market cycles, Dent pointed out.
According to the CryptoQuant analyst, the last notable shift in Bitcoin’s active addresses occurred post all-time high (ATH) levels, leading to what is called a “dead cross,” where the short-term average fell below the long-term average.
This pattern typically signals bearish sentiment or market stagnation. However, the current reversion to a golden cross shows a different scenario. Transaction volumes are almost double what they were during Bitcoin’s 2021 price cycle, a favourable sign of increased market engagement and potential upward momentum.
The analyst concluded that a weaker or inconclusive golden cross could lead to a repeat of mid-2021 trends, where price gains faced strong resistance without maintaining upward movement.
BTC On Track For $100k Rally?
In the past weeks, Bitcoin has seen quite a noticeable rebound in price, reclaiming price levels it once faced resistance in. So far, the asset has recorded double digit gains in the slightly higher time frames suggesting that a positive momentum has begun.
Particualry, in the past 30 days, BTC has increased by 13% and nearly 10% in the past 7 days. This increase has brought the asset price to currently trade above $72,000 as of today.
This price zone not only equals 2.3% decrease from its ATH registered in March 2024 but also marks a vital level that makes the increase above $100,000 more likely.
Highlighting this, renowned crypto analyst, Javon Marks noted that with Bitcoin so far holding above $67,559, the rally to $116,652 is in play.
#Bitcoin (BTC) has just recently marked its highest 3 Day close EVER, and is currently holding above a vital level at $67,559.
Being above this level means the target at $116,652 is, according to technicals, in play, implying room for another +61.2% upside from here! https://t.co/R483X5gC5J pic.twitter.com/rBKjwXdPft
— JAVON
MARKS (@JavonTM1) October 30, 2024
Featured image created with DALL-E, Chart from TradingView