Bitcoin’s price has mainly stayed steady over the past month. Is data from blockchain transactions suggesting the price is strong?
Bitcoin’s price has been relatively stable for the past month, even with significant developments like spot Bitcoin ETFs and crypto lawsuits. However, data from blockchain transactions indicates that the way BTC is being traded reflects strength in the overall trading cycle.
Spike in BTC Active Trading: Strength or Weakness?
Glassnode data reveals that the amount of Bitcoin supply active in the past 6 months to 1 year, as per a 1-day moving average, has recently reached a 6-month high. Notably, this increase started around the same time Grayscale won its lawsuit against the SEC regarding the conversion of the Grayscale Bitcoin Trust to a spot Bitcoin ETF.
When we look at Bitcoin supply that hasn’t been active for over 6 months, a peak in this metric typically happens during one of two situations: a strong bull market or a significant selling-off period.
What’s in Store for Bitcoin’s Price Next?
The XRP lawsuit Summary Judgment marked a significant moment in the altcoin space, while major financial institutions like Blackrock sought SEC approval for a spot Bitcoin ETF. These factors boosted investor confidence, but the ongoing direction of the United States‘ macroeconomic landscape remains uncertain.
The upcoming US Federal Reserve’s Federal Open Market Committee (FOMC) meeting, set for September 19-20, 2023, indicates a 98% likelihood, according to CME FedWatch Tool respondents, that the Fed will maintain its current interest rate target of 525-550 bps.
In the past two years, the central bank’s aggressive rate hikes often led to Bitcoin’s high volatility surrounding FOMC decisions. However, since the start of 2023, there has been a slowdown in this trend due to optimism regarding monetary policy easing, including rate cuts or pauses.
Important: Please note that this article is only meant to provide information and should not be taken as legal, tax, investment, financial, or any other type of advice.
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