Indicator suggests Bitcoin rally to continue as it surpasses $45k mark
Bitcoin (BTC) had been consolidating around the $42,500 zone during the holiday season, but an important indicator suggests that the flagship cryptocurrency is poised for a further rally.
At the time of writing, BTC is up by 6.9% in the past 24 hours and is trading at $45,250. This marks a 21-month high, last seen in early April 2022. The market cap of Bitcoin has surged to $886 billion.
Furthermore, Bitcoin’s daily trading volume has also experienced a significant increase, rising by 60% to reach $27 billion.
Data provided by Santiment, a market intelligence platform, reveals that the Bitcoin Relative Strength Index (RSI) has recorded a slight uptick from 55.7 to 56.2 over the past day. This indicates that the leading cryptocurrency has not faced strong selling pressure, particularly from major investors, implying the potential for a further increase in price.
In order for Bitcoin to maintain its bullish momentum, it is important for the RSI indicator to remain below the 60 zone.
Additionally, whale activity in the Bitcoin market has been declining in recent days. According to Santiment, transactions involving at least $100,000 worth of BTC dropped from 8,769 trades on December 29 to 5,764 unique transactions at present. When whale activity decreases, it typically results in lower price volatility for the asset.
Santiment’s data also shows that Bitcoin’s total open interest (OI) has increased by 5.5%, surging from $7.22 billion to $7.61 billion. As the total BTC OI rises, long-position contracts slightly outweigh short-position holders. The current aggregated total funding rates for Bitcoin is approximately 0.03%, indicating that the majority of traders are betting on the asset’s upward movement.
However, the exact proportions of long and short positions remain unclear.
In a report on January 1, a YouTube analyst expressed optimism about the bullish outlook for the crypto market in 2024. He highlighted the significant gains recorded in 2023 despite the regulatory challenges faced by the industry.
In other news, 1INCH has emerged as the top crypto gainer as the new year begins.
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