Journalist
Posted:
- During the week, new demand for BTC reached its highest level yet this year.
- However, the price drop below $37,000 has caused some coin holders to distribute their BTC.
Leading cryptocurrency Bitcoin [BTC] has made an exceptional comeback this week and hit some annual highs. On November 15, the coin regained the $37,000 price level after recording a 6% intraday rally during that day’s trading session.
BTC ended the day at a high of $37,880 before witnessing a correction. The last time the coin traded at such a high level was in May 2022.
At the time of writing, BTC exchanged hands at $36,378, down 2% in value over the past 24 hours, according to data from CoinMarketCap.
As the price of the coin rose to an 18-month high, so did demand for new coins. On-chain data sourced from IntoTheBlock showed that the coin’s adoption rate reached an annual high of 67.62% during the week.
This indicated that there was a significant increase in the number of new market participants this week.
Source: IntoTheBlock
Additionally, information from the same data provider revealed that the amount of BTC held by addresses holding more than 1,000 BTC also reached a new annual record this week.
This cohort of BTC investors significantly reduced their BTC holdings following the collapse of crypto lender Genesis and crypto trading firm Alameda Research in 2022.
However, in early 2023, they gradually increased their exposure to the leading coin, bringing their cumulative holdings to a high of 7.67 million coins this week.
Source: IntoTheBlock
In the derivatives market, BTC open interest topped $17 billion this week, an all-time high. BTC options open interest tracks the number of options contracts that have been traded but not yet closed or expired.
As of November 17, BTC open interest was $16.40 billion.
Are the bulls giving way to the bears?
While BTC’s network activity saw a surge this week, a review of the coin’s movements on the daily chart revealed a significant decline in bullish momentum over the same period.
A look at BTC’s Moving Average Convergence Divergence (MACD) indicator showed that the MACD line crossed below the signal line on November 12.
The move, also called a bearish crossover, showed that the bears had regained control of the market and the price of the coin could fall.
Since the crossover, the indicator has only shown red histogram bars, suggesting that downward pressure on the price of BTC could increase.
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Resting above their midline at the time of writing, BTC’s Relative Strength Index (RSI) and Money Flow Index (MFI) chased new lows throughout the week. At the time of writing, the coin’s RSI was 59.44, while its MFI was 59.42.
The continued decline recorded by these indicators indicated a preference among coin holders to sell their BTC rather than make purchases.
Source: BTC/USDT on TradingView