Why is Bitcoin going up? Is the Bitcoin market trough finally behind us?

• The price of Bitcoin has increased by nearly 5% since last weekend.
• There was a buy signal coming from on-chain measures, but also concerns about “artificial demand”.

Bitcoin (BTC) has gained 4.5% since Saturday, June 29. In doing so, the support zone that extended to March 1 was retested and defended as support. In addition, the lows of the price range of the last three months were also preserved.

Source: BTC/USDT on TradingView

At press time, the mid-bar at $63,300 was acting as resistance. Technical indicators showed that a bullish reversal on higher time frames was not yet in sight.

However, in the lower time frames, last week’s bearish sentiment and the unbalanced futures market meant that liquidation levels to the north could be sought.

The question of why Bitcoin is rising is partly answered here, but other factors also come into play. Will the bulls push the price higher?

Measurements indicate network-wide accumulation, but also hint at problems

Source: Santiment

The 30-day MVRV ratio was negative, meaning short-term holders were out of the money. However, over the past six weeks, the average coin age has been trending decidedly upwards. This was a positive combination.

This indicates accumulation among holders while signaling an undervalued asset. Together, this marks a short-term buying opportunity. This could set up a rally for the king of crypto.

However, the network value-to-transactions ratio, calculated here based on circulation, showed that Bitcoin was overvalued relative to the amount of BTC traded daily on-chain.

This could bother bulls but is overshadowed by the combination of MVRV and average coin age.

Liquidity pool signals BTC to move higher

Source: Hyblock

The $55,000 liquidation cluster has not been tested as the bulls have prevented the price from falling below the psychological support at $60,000. Not all areas of high liquidity need to be tested. If the price continues to climb, the $73,000 area is the next area of ​​interest for traders.

The path ahead is not straightforward for the bulls. A tweet from CryptoQuant’s Head of Research Julio Moreno highlighted that Bitcoin miners’ capitulation is near and prices may have formed a local bottom.

Read Bitcoin (BTC) Price Prediction for 2024-25

Another crypto analyst, Axel Adler, observed that it was crypto exchanges that were capturing most of the Bitcoin sold in recent weeks, not the broader market.

While this is not inherently negative, the analyst believes that other cohorts of holders are selling and this artificial demand may not be healthy in the long term.