bitcoin's bullish price momentum has waned in recent weeks, casting doubt on the progression of the cryptocurrency's bull cycle. On Friday, April 12, the cryptocurrency market witnessed a sudden crash, causing the value of the leading cryptocurrency to drop from $70,000 to below $67,000.
This latest drop underscores bitcoin's price struggle to return to its recent all-time high of $73,737, which was reached in mid-March. On-chain analytics platform Santiment has identified a particular bitcoin metric that may signal the resumption of the bull market.
bitcoin Bull Run May Resume If This Metric Falls
In a recent x.com/santimentfeed/status/1778930037498274178″ target=”_blank” rel=”nofollow”>publish in x, blockchain intelligence firm Santiment provided an interesting insight into the current cycle and price performance of bitcoin. The company pointed to the average dollar investment age metric as one of the indicators to watch as the market leader moves sideways.
According to Santiment, the Average Dollar Investment Age metric tracks the average investment age in an asset held in the same wallet. When this indicator increases, it means that investments are becoming increasingly stagnant and old coins are kept in the same wallets.
In contrast, a declining average dollar investment age metric implies that investments are returning to regular circulation. This “downline” also suggests an increase in network activity.
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A chart showing bitcoin's Mean Dollar Invested Age | Source: x.com/santimentfeed/status/1778930037498274178" target="_blank" rel="nofollow">Santiment/x
From a historical perspective, bitcoin exhibited a declining average dollar investment age line during previous bull cycles. According to Santiment, this has been the case for the main cryptocurrency in the current bull run, which began at the end of October 2023.
However, the on-chain analytics platform noted that bitcoin's average dollar investment age line has been moving sideways over the past few weeks. This phenomenon is even more shocking, considering that the long-awaited halving event is about a week away.
The bitcoin halving will see the miners' reward halved (from 6.25 btc to 3.125 btc). It is a bullish event that has contributed to the optimistic outlook (held by most investors) for the leading cryptocurrency in 2024.
According to Santiment's latest report, investors may want to keep an eye on bitcoin's average dollar investment age metric. And the bull run is likely to continue if btc's dollar investment median age line resumes its decline, which would imply that major stakeholders (such as whales) have put the coins back into regular circulation.
btc price at a glance
At the time of writing, bitcoin is trading around $66,548, reflecting a notable 6% price drop in the last 24 hours.
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bitcoin price falls below $67,000 on the daily timeframe | Source: BTCUSDT chart on x/JmiThyL7/" target="_blank">TradingView
Featured image from iStock, chart from TradingView
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