- Bitcoin’s recent rise to $65,497 may face a short-term correction due to declining Daily Active Addresses (DAA) and high holder profitability indicating potential profit-taking.
- Key support and resistance levels to watch are $63,093 and $65,838, with a possible dip to $60,348 if the support fails.
Bitcoin’s recent surge to $65,497 has surprised many investors, contradicting earlier bearish expectations for September. However, data from the Daily Active Addresses (DAA) divergence suggests that BTC might face a short-term correction before attempting to reach the $70,000 mark.
Price DAA Divergence: A Sell Signal?
The DAA metric checks if user engagement grows with a coin’s value. When both price and active addresses increase, it typically signals a buying opportunity, suggesting further value appreciation. Conversely, a decline in DAA amidst a price increase indicates a weakening trend, which is considered a sell signal.
At the time of writing, Bitcoin’s DAA had plummeted to -54.89%. This significant drop indicates reduced market interaction with Bitcoin, suggesting that the recent uptrend might be short-lived.
Profitability and Historical Trends
Bitcoin’s recent price performance has notably impacted holders’ profitability. On September 16, 79.92% of Bitcoin holders were in profit. This figure has now increased to 91.97%, based on the Historical In/Out of Money (HIOM) metric. This comparison of addresses making money at different price levels indicates a high profitability ratio.
Historically, such high profitability levels often lead to profit-taking, causing the price to drop. For instance, in July, when 93% of holders were in profit, Bitcoin’s price later fell, reducing the profitability percentage to 78%. A similar situation occurred on August 25, with profitability dropping from 88.35% to 76.23%. If history repeats itself, Bitcoin could be set for a short-term pullback.
BTC Price Prediction: A Potential Dip to $60,000
While Bitcoin’s price is expected to maintain a positive long-term outlook, the daily chart suggests that its attempt to reach $69,000 has met significant resistance. This resistance indicates bearish attempts to counter bullish dominance.
Should Bitcoin’s price fall below $65,000, the $65,838 region will act as a crucial resistance zone. Buyers are likely to defend Bitcoin from dipping below the support at $63,093. However, there is potential for this defense to fail, possibly driving the price down to $60,348 in the coming days.
On the other hand, a close above $65,838 could shift the momentum in favor of the bulls, potentially pushing Bitcoin’s price to $68,236.
Bitcoin’s recent surge to $65,497 has defied bearish predictions for September. However, the DAA divergence and historical profitability trends suggest a possible short-term correction. Investors should watch the critical resistance and support levels as Bitcoin’s price action unfolds. While a dip to $60,000 is possible, a strong close above $65,838 could pave the way for further gains towards $70,000.
