Bitcoin (BTC) has formed a new resistance level at the $63,000 price region. However, the current resurgence in its network activity suggests a rally above this level is possible.
So far, July has been marked by an uptick in activity on the Bitcoin network.
Bitcoin Witnesses Surge in Daily Active Addresses
On July 1, the count of unique addresses involved in at least one transaction involving the leading cryptocurrency asset totaled 902,000. This marked a 34% uptick from the 674,000 recorded in daily active addresses on the Bitcoin network on June 30.
Additionally, the number of new addresses created for trading BTC jumped by 42%, reaching 434,000 that day.
Bitcoin Daily Active Addresses. Source: IntoTheBlock
When an asset sees an uptick in daily active addresses and new addresses, it is a positive sign. It suggests that more users are interacting with the asset, and new investors are entering the market.
A spike in an asset’s network activity is one of the first markers of a potential price rally. While speaking to BeinCrypto on the significance of the recent hike in Bitcoin’s network activity, Juan Pellicer, a senior researcher at crypto research firm IntoTheBlock, noted:
“This is a hopeful sign for Bitcoin, as on-chain activity has been on a notable downtrend since March of this year.”
Apart from this, BTC whales have intensified their accumulation in the last month. On-chain data show that large BTC holders have bought over 55,000 BTC, valued above $3 billion, at current market prices in the past 30 days.
Read More: 5 Platforms to Buy Bitcoin Mining Stocks After 2024 Halving
Bitcoin Large Holders Netflow. Source: IntoTheBlock
According to Pellicer, this accumulation behavior was strongest during Bitcoin’s recent dip to $60k, indicating buy pressure from large holders around this level.
BTC Price Prediction: Caution is Necessary
While there has been a recent surge in BTC’s network activity, it remains at risk of extending its decline. Exchanging hands at $60,276 at press time, the leading coin’s value has dropped by 13% in the past 30 days.
BTC trades below its 20-day exponential moving average (EMA) at its current price. It has traded below this key moving average since June 11.
An asset’s 20-day EMA tracks its average price over the past 20 trading days. When the price falls below this level, it’s generally considered a bearish signal. This means that the asset’s price has been making lower lows compared to the average price over the past 20 days.
If this trend continues, BTC’s price may fall to $58,698.
Read More: Bitcoin (BTC) Price Prediction 2024/2025/2030
Bitcoin Analysis. Source: TradingView
However, if the sentiment trailing the king coin shifts from bearish to bullish, the projection above will be invalidated, as the coin’s price will climb to $61,839.
