Santiment, an on-chain analytics company, has noticed that Bitcoin (BTC), the largest cryptocurrency by market capitalization, may be publishing a significant signal related to its short-term price movement.
According to the on-chain analytics tool, Bitcoin just had its greatest level of daily address activity in the previous three and a half months.
The number of transactions on the Bitcoin network at the beginning of August was 1.07 million unique addresses, which is a record high since April 17.
Santiment said in a tweet that in August, Bitcoin address activity rose to its greatest level in 3.5 months. The article continues by stating that this rise in utility together with large-loss transactions and unfavourable attitude may be a clear indication that a short-term (or at the very least, immediate) BTC price comeback is more possible.
The on-chain analytics company said that traders have been trading BTC at losses close to the highest they have seen all year in a picture that was included with the tweet. This indicates surrender. Santiment highlighted that this may be a tip to purchase.
Here’s what to watch out for
At the time of publication, Bitcoin was steady, with the biggest digital asset in the world increasing 0.10% to $29,132.
Since the initial excitement about a fresh wave of Bitcoin exchange-traded fund (ETF) applications fizzled, the cryptocurrency market has remained largely stable.
Lead cryptocurrencies Bitcoin and Ethereum have stayed solidly established with the ups and downs of the S&P 500, according to Santiment. The dollar has increased over the last several weeks, which traditionally signals market declines.
Santiment advises traders to watch for a decreased connection between equities and cryptocurrencies as a breakthrough signal.
Other signs point to Bitcoin’s future success. As stablecoin inflows to cryptocurrency exchanges now surpass BTC inflows, crypto analyst Ali notices a rise in buy-side demand for BTC, signalling increased purchasing desire.
The amount of Bitcoins available on exchanges has also decreased by 30% since its high in early 2020.
