While Bitcoin was expected to record higher levels than BTC after rising above $ 30,000, BTC dropped to $ 27,000 with a sudden decrease.
While investors were wondering if the decline in Bitcoin has ended and when it will start to rise, the Bitcoin evaluation came from the popular crypto money platform Santiment.
Santiment said that there are three important metrics to watch for BTC to decide whether Bitcoin will visit $30,000 or $25,000 in the next step after this correction.
Saying these three metrics are trading volume, market circulation, and wallet activity, Santiment noted that without the increasing amount of coins moving from address to address, and the growing number of addresses interacting with these rising coins, most rallies have historically been short-lived.
Pointing out that bull traps usually occur when prices are rising rapidly, Santiment said, "traders get FOMO and buy inflated market values, shortly after they buy, the rally quickly stops and they are caught off guard."
Stating that this situation occurred with the pump experienced in the three-month period at the beginning of 2023, Santiment thinks that these criteria give a decrease signal in Bitcoin.
" In terms of Trade Volume: After BTC peaked on March 14th during the initial rise of over $25,000, the trading volume dropped sharply. Then there was a price drop. When we came to April and Bitcoin rose above $30,000, the trading volume has been around since the first week of 2023. It has returned to its lowest levels and is again on a decline.
Daily active addresses: Contrary to trading volume, active addresses on the BTC network increased very slightly. However, in the bull runs of 2020 and 2021, Bitcoin's amount of unique addresses had increased much more than it does now. Since the beginning of 2023, active addresses have increased by 11%, while the price of BTC has increased by 65%. More active addresses need to increase more for a real bull.
BTC circulation: The amount of BTC moved every day does not seem as hot as address activity. In mid-March, while the markets hit the bottom, circulation fell again after a temporary rise. So much so that the amount of BTC carried per day is 6.4% lower than the situation on January 1, when the price was at $ 16.7 thousand.”
Santiment stated that apart from the criteria he examined, there are also on-chain vital signals such as whale activity and MVRV.
📊 As #Bitcoin goes through tug of war to decide whether it revisits $30k or $25k next, @santimentfeed looks at $BTC's utility levels in our latest insight. Read how volume, circulation, & address activity are a key trio to watch before the next bull run. https://t.co/18G2hvvAQI pic.twitter.com/c8GmofuM8j
— Santiment (@santimentfeed) April 25, 2023
*Not investment advice.
