Bitcoin (BTC) may not have reached its peak demand yet, according to on-chain analyst Axel Adler. This could be because new investors haven’t jumped in at the same rate they did during previous bull runs, he suggests.
However, Adler’s analysis on X (formerly Twitter) also points towards a potential future surge in new investor activity, based on the Ratio of Old and New Bitcoin Supply. The current ratio indicates Bitcoin is not yet in an area of historically high demand, potentially signaling room for growth in the mid to long term.
While Bitcoin’s price sits around $63,719 at the time of writing, down nearly 5% in the last week, analysts are looking at user behavior for clues about future price movements.
IntoTheBlock’s user engagement metrics show a rise in active addresses (existing users transacting) by 6.47% over the past week. However, new addresses (users making their first transaction) remained stagnant, aligning with Adler’s view of lower new investor participation. This stagnation could lead to a further price dip in the short term.
Recent predictions suggest Bitcoin could fall to $54,000, though this might not happen immediately. A potential drop towards $61,000 seems more likely in the near future.
Another factor to consider is the Mean Coin Age (MCA), which reflects the average age of all Bitcoins based on purchase price. A rising MCA signifies that older coins are being moved, often by long-term holders selling. Currently, Bitcoin’s 90-day MCA is trending upwards, potentially indicating a price drop towards the predicted $61,000 mark.
Adding to this bearish sentiment, the Relative Strength Index (RSI) on the 4-hour chart is nearing the oversold region. The RSI measures momentum and indicates overbought or oversold conditions. While oversold readings can suggest a potential rebound, they can also precede further price drops.
Overall, the picture for Bitcoin seems mixed. While on-chain data suggests long-term demand potential, short-term price pressures might persist due to stagnant new investor activity and holder selling. Whether Bitcoin rebounds or dips further depends on a shift in buying pressure and overall market sentiment.
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