Analytical platform IntoTheBlock has revealed an increase in daily new Bitcoin addresses, suggesting the return of retail crypto investors to the market.
Bitcoin’s New Addresses Show Renewed Interest
Since November 2023, The number of daily new addresses has trended downward, a bearish signal indicating fewer new participants, particularly on the retail side.
However, the trend seems to be shifting, with the number of new… pic.twitter.com/EpAjaqpcZG
— IntoTheBlock (@intotheblock) August 8, 2024
IntoTheBlock noted that the number of daily new Bitcoin addresses had declined steadily since November 2023, indicating fewer market participants.
However, the latest observation indicates a gradual shift in trend, with the number of new addresses increasing recently.
IntoTheBlock Reveals Renewed Interest from Retail Investors
Glassnode data shows that on June 7, the number of new Bitcoin addresses for 2024 reached a low of 203,536. However, in August, the number of new Bitcoin addresses increased, oscillating between a low of 286,000 and a high of 337,000.
IntoTheBlock notes that this increase will potentially result in a more balanced market and a stronger foundation for Bitcoin’s next growth phase.
Notably, Bitcoin witnessed a notable price dip in early August, dropping to a low of $49,221 on August 5. However, it has recovered from the price slump and is currently approaching the $61,000 threshold.
Analyst Identifies Death Cross Pattern Hinting at Mega Bitcoin Rally
Amid the recent recovery, ITC Crypto founder Benjamin Cowen revealed in an X post that the crypto market might form a Death Cross.
On Monday on my YouTube channel I mentioned that we would likely see a #BTC rally into its death cross.
You can see that rally has now arrived.
So perhaps some context is needed –
What happened during prior death crosses?
Thread 👇 pic.twitter.com/pDbfYTseYs
— Benjamin Cowen (@intocryptoverse) August 8, 2024
For clarity, a Death Cross is a pattern that occurs when the 50-day SMA falls below the 200-day SMA.
Cowen noted that Bitcoin’s 2023 rally began after the formation of a Death Cross. Similarly, in 2022, BTC rallied briefly into the Death Cross but dropped after forming the cross.
In 2023, #BTC started its rally just after the death cross. It then got above its 50D SMA and subsequently held it as support before going higher. pic.twitter.com/jF8MoTfP3H
— Benjamin Cowen (@intocryptoverse) August 8, 2024
According to Cowen, the rally can only be sustainable if Bitcoin breaks above its 50-day SMA at $62,000, making it a support. However, if the $62,000 support level fails to hold, BTC’s price will slowly decline until inflation rates fall.
While this appears bearish, network economist Timothy Peterson stated that a Bitcoin Death Cross is not so deadly. He claims the death cross has occurred only eight times since 2015. According to Peterson, in some cases, Bitcoin rallied by 62% 60 days after the Death Cross.
#Bitcoin ‘death cross’ not so deadly.
Bitcoin faces an imminent “Death Cross” where the 50-day average crosses below the 200-day average.
This has happened only 8 times since 2015.
What happens next?
60 days later, Bitcoin was up 62% of the time. The median return was +18%. pic.twitter.com/EdTz5n5C8L— Timothy Peterson (@nsquaredvalue) August 7, 2024
How is BTC Faring Today?
Bitcoin formed a bullish engulfing pattern on August 7, slipping into a downtrend between July 29 and August 5, forming lower lows on the daily chart.
This bullish pattern sent BTC above the $60,350 support level. Bitcoin is approaching the $62,000 resistance level, and a break above it will likely result in further price gains.
However, technical indicators suggest a bearish outlook in the coming days. The 50-day Simple Moving Average (SMA) is dropping and about to form a Death Cross with the 200-day SMA.
If the death cross forms, Bitcoin will likely retreat to the $60,350 support level. The RSI indicator confirms this bearish sentiment, dropping from the neutral zone to 47.23.
While Bitcoin shows signs of improvement, investor sentiment remains neutral. Therefore, Bitcoin will likely decline in the coming days before the rally continues.
Disclaimer: The opinions expressed in this article do not constitute financial advice. We encourage readers to conduct their own research and determine their own risk tolerance before making any financial decisions. Cryptocurrency is a highly volatile, high-risk asset class.
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