New data on the chain indicates an increased demand for Bitcoin (BTC) by new investors. In particular, the number of new BTC addresses is approaching the 2017 level when the price reached $ 20,000.
Brooke Connelly, CEO of RoundBlock Capital said:
“Has anyone noticed that daily active headlines (Bitcoin) are back above June 2019 levels and close to 1.29mm in December 2017? The bitcoin market looks very different now.”
Several metrics on the chain indicate a continued bullish trend for Bitcoin, despite the fact that the digital asset has risen by 28% in the past three weeks.
Buyers are showing renewed interest as new BTC headlines rise
After the Bitcoin flash crash on August 2, the price of both BTC and Ether (ETH) rose steadily. At that point, forward liquidations exceeding $ 1 billion in one hour caused the market to fall briefly.
Since then, the major cryptocurrencies have stabilized and experienced less volatile price movements. The stability of BTC and ETH could also indicate the beginning of the accumulation phase.
While BTC’s price action has been strong this week, the digital asset has plenty of technical reasons to see a drop of $ 11,700 to $ 12,000. Historically, $ 12000 has been a strong resistance level, and any attempt to close a weekly candle above it in the past two years has resulted in extended corrections.
However, Bitcoin’s price is steadily rising as major numbers such as new BTC titles continue to rise. The data indicates that many investors are gradually pooling bitcoin.
One possible reason for Bitcoin’s continuous bullish trend over the past five days could be the profitability of titles. According to IntoTheBlock, 93.76% of all Bitcoin addresses are now profitable. The researchers said:
The Bitcoin network has a total of 702.11 million addresses, of which 30.99 million are currently in BTC. At the current price of $ 11,758.8, 93.76% of titles currently in balance are capitalizing on their BTC positions. ”
Bitcoin flows in and out of wallets
Bitcoin flows in and out of wallets. Source: IntoTheBlock
Chain analysts often measure title profitability by capturing the Bitcoin value that was first transferred from an address. Although it can be imprecise at times, it usually indicates when he first bought the title BTC.
When most titles are profitable, the need to sell BTC in a short time decreases. While an argument can be made about falling profits, the current stability of BTC suggests otherwise.
$ 12,000 is the biggest hurdle
In the short term, the biggest hurdle for Bitcoin is the $ 12,000 resistance level. In the past few weeks, BTC has consolidated just below its level, and it should be noted that consolidation near a major resistance area could be seen as a sign of optimism.
Technical analyst Edward Moura suggested that spot traders on Coinbase and Bitstamp are defending the $ 11,600 to $ 11,700 range. An abundance of buy orders in the support area can reduce the likelihood of a large drawdown.
Some traders are closely watching the opening of the US stock market on August 7th as it coincided with the release of the new jobs data. In the past few months, positive jobs data has led to a rally in the cryptocurrency market.