Key Points
- The Delta Gradient indicates a potential decline in Bitcoin’s price over the next one to two months.
- A decrease in active Bitcoin addresses suggests a potential drop in demand for the cryptocurrency.
A recent analysis of Bitcoin’s (BTC) price patterns suggests a possible downturn in the coming weeks. This potential decline, which could span over a month or two, aligns with historical trends of the cryptocurrency.
Understanding the Delta Gradient
The Delta Gradient is a key metric in this prediction. This indicator measures the relative change in momentum against the true organic capital of a cryptocurrency. A positive gradient indicates an uptrend, typically lasting between 28 to 60 days.
At the time of writing, Bitcoin’s Delta Gradient was -2.34, suggesting a possible continuation of the current downtrend. This could result in Bitcoin’s price falling below $60,000, as it did a few days ago.
Interpreting Network Metrics
The Network Realized Profit/Loss is another crucial metric, showing the value of transactions that have realized a profit or loss recently. A positive reading suggests high profit-taking, potentially leading to a price drop. Conversely, a negative reading indicates a surge in realized losses, which could trigger a price increase.
However, Bitcoin’s Network Realized Profit/Loss was -1.92 million, implying that a significant number of transactions resulted in losses. While this decline typically precedes a price increase, the recent decrease in Bitcoin’s network activity may alter this outcome.
The number of 24-hour Active Addresses was down to 694,000 from nearly one million a few days ago. This drop in user activity could lead to a significant decline in demand for Bitcoin.
Despite the potential decrease in demand and price, some analysts believe that Bitcoin’s correction phase might soon end. They argue that the recent week has been positive for the cryptocurrency, and previous cycles didn’t always feature deep corrections.
