After reaching a low of $89k just a week ago, Bitcoin [BTC] has experienced a notable surge in value. Currently, BTC is trading above $105,000, reflecting gains of over 11% in the past week. This bullish trend in Bitcoin’s price has sparked optimism within the crypto community.
Following the recent price increase, there is speculation among some investors regarding a potential short-term rally, particularly focusing on ultra-short-term traders.
Positive Sentiment in Bitcoin’s Ultra Short Term Outlook
According to analysis from Burak Kesmeci at CryptoQuant, Bitcoin’s 1-7 day UTXO average has surpassed the 7-30 day UTXO average. This suggests that the average acquisition cost of Bitcoin in the past week is increasing, indicating a rise in interest despite recent price surges.
The emergence of this bullish signal reveals that the current price momentum is supported by significant capital inflows. The influx of short-term investors demonstrates a strong demand, highlighting Bitcoin’s resilience in maintaining its upward trajectory. Essentially, new investors are displaying increased confidence in entering the market despite market fluctuations.
With the golden cross signal arising, market sentiment appears optimistic for the short term, potentially paving the way for further price appreciation in BTC.
Notably, historical data indicates that the last occurrence of this crossover resulted in a 67% price surge, propelling Bitcoin from $66k to $108k. Therefore, the golden cross suggests a shift towards positive short-term trends and bullish momentum in the market.
If historical patterns are any indication, Bitcoin could witness another significant rally to new all-time highs in the foreseeable future.
Key Metrics to Watch
Bitcoin’s recent golden cross aligns with a notable uptrend in its price performance. However, the question remains: Can this momentum be sustained?
According to CryptoCrypto’s analysis, ongoing market conditions and metrics imply that the current uptrend may persist for the time being.
For instance, Bitcoin’s exchange whale ratio has experienced a significant decline, reaching a weekly low and signaling bullish sentiment among major holders who are accumulating BTC off exchanges.
Furthermore, positive market sentiment is evident in Bitcoin’s funding rate, which has increased to 0.0166. This indicates a preference for long positions over shorts among investors.
Additionally, Bitcoin’s NVT Golden Cross has dropped into negative territory, potentially presenting a buying opportunity for investors to accumulate BTC at relatively lower prices before any further uptrend. This suggests that Bitcoin remains reasonably priced for new entrants into the market.
Given these supportive market conditions, a breakthrough past the $106k resistance level could lead to Bitcoin surpassing its previous all-time high in the short term. However, a loss of momentum among short-term investors may result in temporary price corrections.