2020-2-22 22:02 |
Last week, Bitcoin managed to breach $10,000 mark again but it didn’t stay there long and went below $9,500 yet again. During the past week, bitcoin price suffered a rapid drop and has now leveled out around $9,600.
Does this mean, we have reached the local top for the time being or another rally could be seen in the coming days? From the fundamentals’ perspective, the network activity also suffered stagnation and ”meaningful decreases,” said crypto data provider Glassnode.
A 16% drop has been recorded in entity-adjusted transaction volume since last week. This metric filter out transactions in which BTC doesn’t change hands, as such providing a clear signal of actual economic activity.
This sharp decrease suggests, “at least on-chain, economic activity may be slowing down.”
Another metric, aSOPR (adjusted spent output profit ratio) has dipped below 1 again but a quick recovery would support the bullish narrative. However, if it stays below for too long, it would indicate that Bitcoin has hit a local top.
Bullish SignalsMeanwhile, the number of unique active entities has been on the rise in 2020, for the first time since the price peak in mid-2019.
“This is a potential sign that Bitcoin market participants are returning to the network, with more participants actively transferring BTC on-chain.”
However, despite this general up-trend, the past week has also seen a decrease in active entities on-chain. Corresponding with the rapid 6% price dip in BTC price late on Wednesday resulted in an overall decrease in on-chain activity over the past week, which “may trigger some concern.”
One concession is that a similar pattern was seen in late January, a drop in active entities and price, before they both quickly recovered into an upward trajectory.
Going into the weekend, an uptick in the number of unique active entities can be seen, which is a positive sign. Another positive metric this week has been Bitcoin’s Reserve Risk which is at low levels indicating “an attractive risk/reward ratio for investing in Bitcoin.”
Moreover, addresses with balance equivalent of and more than 0.01 BTC and 0.1 BTC keeps on growing, “hitting new ATHs again and again,” which is yet another bullish signal. The number of addresses holding 1+ coins has reached an all-time high of 788,800, surpassing the previous ATH of 788,767 recorded on 23 October 2019.
Bitcoin (BTC) Live Price 1 BTC/USD =$9,714.3620 change ~ -0.34%Coin Market Cap
$177.11 Billion24 Hour Volume
$3.6 Billion24 Hour VWAP
$9.69 K24 Hour Change
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