Three Out of the Four Bitcoin’s Momentum Indicators Are Bear...
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Three Out of the Four Bitcoin’s Momentum Indicators Are Bearish

Bitcoin incurred a sharp rebound from its lows recently, but on-chain indicators are signaling weakness. Over the previous few days, the benchmark cryptocurrency has been heavily volatile as it plunged to lows of $8.9k yesterday, prior to a rebound to the mid-$9k area.

Its performance is part of consolidation recorded over the past few months as it struggles to secure decisive momentum in either direction. Its recent rally to highs of $10.5k reveals strength while a few major factors are making it to flash signs of technical weakness.

At press times, the price of Bitcoin was up by about 1 percent at price levels around $9,466. Its performance over the previous several weeks has been close to this level, striving to move beneath $9k or above $10k. $9k and $10k are the lower and upper boundaries of a trading range between which Bitcoin has remained within over a multi-month period.

The bulls need to overcome the macro-barrier at $10.5k to make the trend favor them. Bitcoin has been rejected firmly at this level three times within the previous few months, and if it fails to clear it, it is a confirmation of the formation of triple top that is currently active.

Bitcoin is still troubled by certain basic technical weaknesses. According to a trader recently, the momentum recorded yesterday will not be sufficient to cancel its recent weakness, possibly showing that a move back down to the lower-$9k area is forthcoming.

When it comes to fundamental factors, few exist suggesting that Bitcoin is positioned for some downward momentum in the near-term. Recently, Analytics platform IntoTheBlock mentioned some metrics saying three of the four Bitcoin’s momentum indicators are bearish:

“3 out of 4 On-chain indicators are showing a Bearish Momentum for Bitcoin… Why? 1) The number of addresses going to zero is higher than the number of new [addresses] created 2)The number of transactions greater than $100k is slowing down 3)The % of addresses in the money is decreasing.”

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Sudarshan M is a long time crypto-enthusiast. Pulled in by bitcoin early on, it did not take long for Sudarshan to divert all of his academic attention from business studies to blockchain by doing his Masters and eventually pursuing his PhD in the subject.