The Bitcoin network is on the verge of experiencing a “golden crossover” in a key on-chain metric, according to a recent analysis by cryptocurrency analytics firm CryptoQuant.
The firm’s report highlights an impending crossover in the Active Addresses Momentum indicator, a key measure of network activity and market trends.
Active Address Momentum tracks unique Bitcoin addresses that are actively participating in the network, providing insight into investor participation and overall market sentiment. In the analysis, CryptoQuant applies a 30-day moving average and a 365-day moving average to measure changes in network activity over different time frames.
A golden cross occurs when the shorter 30-day moving average (30DMA) crosses above the longer 365-day moving average (365DMA), which traditionally signals a bullish reversal and upward price momentum, according to the company. This crossover is often seen as a sign of increased market activity and investor optimism.
After previously encountering a “dead cross” where the 30DMA dropped below the 365DMA following a new all-time high (ATH), the current trend reversal is notable. According to CryptoQuant, this golden cross is currently forming and points to a potential bullish period for Bitcoin. The analysis also noted that transaction numbers have nearly doubled compared to the 2021 cycle, a promising signal for on-chain activity.
However, the firm warned that the sustainability of the trend will depend on the strength of the crossover. If the 30DMA fails to rise decisively above the 365DMA, the market could resemble the mid-2021 phase where mixed price action was seen despite the initial golden cross.
*This is not investment advice.