CryptoQuant, a leading cryptocurrency analytics firm, has identified a potential bullish sign for Bitcoin, citing the recent behavior of the Coinbase Premium Index as a key indicator.
According to their analysis, Bitcoin could be poised for a short-term price increase driven by renewed demand from US-based investors.
The Coinbase Premium Index, which tracks the price difference between Bitcoin on Coinbase and other exchanges, is often used as a gauge of U.S. investor interest. CryptoQuant analyzed the index on a 1-hour time frame using both 24-hour (daily) and 168-hour (weekly) moving averages to assess short-term momentum. Historically, significant price moves have often been followed when the daily moving average crosses above the weekly moving average, a formation known as a “golden cross.”
Currently, the daily moving average has temporarily moved above the weekly average, narrowing the gap between the two. This suggests that upward pressure may be building with the possibility of a short-term rally. “The gap between the daily and weekly averages is narrowing,” CryptoQuant noted, pointing to past examples where such a golden crossover has led to price increases.
As an example, CryptoQuant cited the price correction from $66,000 to around $61,000 on October 1. Despite the decline, they noted that demand from U.S. investors remained strong, reflected in the rising Coinbase Premium. This consistent demand could provide the necessary momentum for Bitcoin to recover and rise in the short term, according to the report.
*This is not investment advice.