Within the last 24 hours, Bitcoin [BTC] has seen a notable increase, reclaiming the $100,000 threshold.
Nonetheless, there has been a slight retreat in the recent hours, with Bitcoin currently trading at $99,417, having risen by 2.58% on daily charts as of the time of writing.
This small retreat reflects Bitcoin’s struggle to maintain its upward momentum, leading analysts to forecast a pessimistic outlook for the cryptocurrency.
As a result, Crypto expert Yansei Dent has pointed out a potential period of price stagnation in the medium to long term, attributing this to the appearance of a ‘dead cross.’
The Emergence of the Death Cross in Bitcoin’s Active Addresses
In Dent’s analysis, he notes that Bitcoin has entered a phase of stagnation, with active addresses indicating a decline in momentum.
He highlights the presence of a death cross on the 30-Day Moving Average (DMA) and 365 DMA, signaling a reduction in short-term investor activity.
Historically, similar trends in active addresses have aligned with bearish market conditions, serving as negative indicators.
Further analysis reveals a decrease in transaction count since Q4 2024, reinforcing the probability of market stagnation in the medium to long term.
Therefore, as these conditions persist, Bitcoin may face challenges in sustaining an upward trend until there are positive signals across the broader market.
Implications for Bitcoin’s Charts
The decrease in activity and the appearance of a death cross indicate a weakening foundation for Bitcoin’s market, potentially hindering its ability to maintain an upward trajectory.
The declining NVT Golden Cross, now at -1.1, underscores this short-term bearish sentiment at the time of publication.
A negative NVT golden cross implies a decrease in Bitcoin’s market worth relative to transactional volume.
This drop in network activity is further validated by a negative Price DAA Divergence, signifying a deterioration in market fundamentals and suggesting that Bitcoin’s current valuation may be unsustainable.
Bitcoin’s fund market premium has dwindled to -0.08, indicating futures prices trading below spot prices, showing a heightened demand for short positions.
Despite Bitcoin’s recent climb back above $100,000, the market conditions do not seem robust enough for sustained growth.
The recent gains appear to be driven by speculative trading, particularly following the release of U.S. inflation data.
Therefore, with weakening foundations, Bitcoin is expected to consolidate within a range of $94,000 to $100,000 in the near term.