Bitcoin enthusiasm grows: Will increased optimism lead to price rise?
Post by Evans Boto and Farah Mirza#### Sharing options
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Bitcoin's BTC realized capitalization skyrocketed to an impressive $882.228 billion, demonstrating investor confidence as of the 29th of April.
This astronomical figure shows a market preparing for a significant price shift. At current pricing, Bitcoin traded at $94,664.28, down 0.33% for the 24-hour period. Despite this minor setback, the sentiment remained predominantly optimistic.
Amplified engagement signifies heightened Bitcoin interest
Bitcoin's Social Dominance was a staggering 25.81%, indicating increased attention on the cryptocurrency. Social Volume has seen continuous growth, suggesting a larger number of participants are actively discussing Bitcoin. As Bitcoin receives more airtime, investor optimism may persist.
Heightened social interest often paves the way for price moves. Potentially, increased social focus could draw fresh capital if the trend continues.
NVT Ratio sits at 460.14, revealing undervaluation
The Network Value to Transactions (NVT) ratio for Bitcoin stood at 460.14, implying that the coin's price appears undervalued compared to its on-chain activity. This gap suggests that the market value has not caught up with activity on the network yet, potentially leading to price growth.
Continued bullish trend despite temporary market corrections
The Price DAA Divergence chart showed a severe -217.59% difference, indicating that price increases outpace Daily Active Addresses (DAA). Despite short-term adjustments, active market participation remains strong, favoring a bullish BTC outlook.
The ongoing divergence suggests that there is sustained demand for Bitcoin, even with the ups and downs in the market. Active Addresses have remained robust, further emphasizing that the bullish trend is likely to carry on, even with temporary market corrections.
Liquidation Heatmap reveals risks and opportunities
Long liquidations dominate around the $94K level on the Binance BTC/USDT Liquidation Heatmap. This hints at potential downward pressure on Bitcoin as long positions are liquidated. The presence of long liquidations can trigger short-term volatility, but if short positions start liquidating too, Bitcoin could see a sharp spike in value.
Can Bitcoin overshoot resistance levels?
Currently, Bitcoin is challenging key resistance levels at $95,709 and $98,666. Potential signs of further upward movement are evident, with Bitcoin settling close to its upper Bollinger Band – a position frequently preceding breakouts in response to accumulated pressure.
The Moving Average Convergence Divergence (MACD) remained bullish, with the MACD line at 2,965.81 above the signal line at 2,289.86. This shows that momentum lies with buyers, setting the stage for upward movement.
With a strong bullish trend, rising interest, and potentially undervalued prices, Bitcoin is poised to surpass the $95,709 barrier and set its sights on $98,666.
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The bullish momentum and increased attention on Bitcoin can be understood through various key factors:
Bullish triggers
- Spot-led buying: The consistent uptrend in Bitcoin is primarily driven by spot-led buying, rather than over-leveraged trading. Spot-driven buying is generally more durable and less susceptible to severe market reversals[1][2].
- Fading US Dollar Strength Index (DXY): The decline in the DXY has reduced demand for the dollar, making risk-on assets, like Bitcoin, more appealing. In addition, increased global liquidity due to monetary policy actions supports Bitcoin's growth[1][2].
- Market correlation: Bitcoin shows strong positive correlation with traditional equity markets, particularly the S&P 500. This means Bitcoin tends to rally when mainstream markets do. Recent price actions suggest Bitcoin can sustain its position even if equities fluctuate[1][2].
- Institutional embrace: The growing interest from institutional investors, such as hedge funds and family offices, brings substantial capital and credibility to Bitcoin. This may drive up demand and elevate prices[5].
- Technological progress: Continuous advancements in blockchain technology bolster Bitcoin's efficiency, security, and scalability. These improvements can generate interest, attract users, and draw investors[5].
- Regulatory clarity: Clearer regulations create a more stable atmosphere for Bitcoin, enticing more businesses and individuals to engage with the digital currency[5].
Indicators like Realized Capitalization, Social Dominance, and the NVT Ratio support the bullish perspective for Bitcoin's long-term growth prospects in 2025, combining financial, strategic, and technological aspects.
- Bitcoin's realized capitalization reached a record $882.228 billion, demonstrating investor confidence as of the 29th of April, possibly preparing for a significant price shift.
- The NVT Ratio for Bitcoin stood at 460.14, suggesting that the coin's price may be undervalued compared to its on-chain activity, potentially leading to price growth.
- Long liquidations dominate around the $94K level on the Binance BTC/USDT Liquidation Heatmap, hinting at potential downward pressure on Bitcoin, which could trigger short-term volatility.
- According to the Price DAA Divergence chart, active market participation remains strong, favoring a bullish BTC outlook, even with short-term adjustments.
- Bitcoin is currently challenging key resistance levels at $95,709 and $98,666, which, if surpassed, could indicate further upward movement and potential price growth.
