- The Delta Gradient revealed that Bitcoin’s potential decline could last one to two months.
- The decline in the number of active addresses raises concerns about the demand for BTC.
Like Bitcoin [BTC] price action rhymes with historical patterns, and then it’s about to move lower than it has in recent days. In short, this expected decline could last a month or two.
However, AMBCrypto did not draw this conclusion without the necessary data. We will explain this in this article. One of the most important metrics that aligns with this prediction is the Delta Gradient.
South is the way
For those unfamiliar, the Delta Gradient measures the relative change in momentum versus a cryptocurrency’s true organic capital.
When the gradient is positive, an upward trend occurs. Typically, this uptrend lasts 28 to 60 days.
At the time of writing, Bitcoin’s downtrend was -2.34. This negative reading implies that the price could continue to experience a downward trend. Furthermore, this expected downtrend could last for a similar duration.
Source: Glassnode
At the time of writing, BTC has changed hands at $61,062. This was a decline of 4.96% over the past seven days. Should the Delta Gradient continue to decline, Bitcoin’s price could fall below $60,000, just as it did a few days ago.
This was also consistent with Bitcoin’s reaction to the period when the realized price rose above the cash value. We also examined the Realized Profit/Loss Network.
Mixed signals appear on the charts
This statistic shows the value of trades that have made a profit or loss recently. A positive reading of the measure implies that profit taking is high. This could therefore lead to prices falling.
However, if the measure is negative, this means that there has been a sharp increase in realized losses. If it is intense, the price may start to rise. According to Santiment, the realized gain/loss of Bitcoin’s network was -1.92 million.
This implied that some of the transactions were on-chain ended in losses.
Normally, this decline is expected to foreshadow a price increase. But that may not be the case due to the declining activity on the Bitcoin network.
At the time of writing, the number of 24-hour active addresses had fallen to 694,000. A few days ago there were almost one million. Active addresses are a measure of user activity.
Source: Santiment
So when it declines, as has happened recently, it means market participants are not interacting with BTC at a high level. Consequently, this could lead to a notable drop in demand for the currency
Realistic or not, here is the market cap of BTC in ETH terms
If demand continues to decline, so will the price. Analyst Michael van de Poppe, however thought that BTC’s correction could soon be over.
According to him, the recently concluded week was good for the currency. He said,
“A pretty decent weekly candle for Bitcoin approaching here. I expect the correction to be relatively over. Also in previous cycles we did not get the most obvious deep corrections.”