Bitcoin is showing promising signs of a new bull run, with daily gains of 7% driving its price higher. This surge in price follows a brief sell-off, and on-chain metrics suggest that the upward momentum may continue.
After reaching $44,000 earlier in the month, Bitcoin experienced a cooling-off period, dropping to nearly $40,000. However, conditions have since improved.
Philip Swift, the creator of Look Into Bitcoin, pointed out on December 13 that profit-taking has increased as BTC/USD reached its highest levels in 19 months.
He highlighted the “Value Days Destroyed” (VDD) metric, which measures Bitcoin selling activity based on the age of the coins being sold and the current BTC price.
On December 11, VDD reached its highest level since May 2021, indicating that some long-term holders (HODL’ers) are taking profits.
Recent selling activity has been driven by short-term holders (STHs), who are typically more speculative in their trading approach.
READ MORE: Bitcoin’s Resilience Shines Amidst Price Correction – Bulls Eye $44,000 Breakout
Meanwhile, analysts see potential for Bitcoin’s price to continue rising towards the key resistance level around $50,000.
Matthew Hyland, an analyst, pointed to the relative strength index (RSI) on daily timeframes, which has displayed a bullish divergence with price, indicating potential upward movement.
Additionally, there is a notable influx of capital into both Bitcoin and Ethereum, reminiscent of late 2020 when Bitcoin first broke the $20,000 mark and entered a phase of price discovery.
This renewed interest from investors suggests confidence in the cryptocurrency market.
Social media commentator Ali expressed optimism about the current market conditions, echoing the sentiment that significant capital inflows are returning to both Bitcoin and Ethereum.
Others share this bullish outlook, with BitQuant emphasizing that Bitcoin could break through the $42,000 to $45,000 channel by the end of the coming week, with no strong resistances in sight until the $63,000 mark.
In summary, Bitcoin is showing signs of a robust bull run, with on-chain metrics, profit-taking, and increased capital inflows contributing to its recent price surge.
Analysts and commentators are optimistic about the cryptocurrency’s potential to continue its upward trajectory, with key resistance levels in focus as Bitcoin aims for new all-time highs.
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