Bitcoin, the largest cryptocurrency asset, could see another positive move. Recent developments around Coinbase Premium create the potential for one short-term rallyindicating a positive outlook for BTC in the coming weeks.
Short-term rally for Bitcoin on the horizon
The Coinbase Premium, a key indicator that measures the price differences of BTC on the Coinbase platform and other cryptocurrency exchanges, shows a possible bullish move for the price of Bitcoin in the short term. This implies institutional investors In the United States, crypto assets are buying heavily, indicating rising demand and bullish sentiment in the US market, which could spark a near-term rebound for BTC as these investors look to capitalize on its growing strength.
Yonsei Dent, a market expert and enthusiast, reported the development in a recent publication quick post on the leading on-chain analytics platform, CryptoQuant. The expert predicts that a short-term rise could be coming after analyzing the Coinbase Premium Index over a 1-hour time frame and using the 24-hour and weekly moving averages to identify short-term momentum.
After the thorough investigation, Dent discovered that when the daily moving average decisively broke through the weekly moving average, significant results were also seen in the price movement.
Given the past movements in Bitcoin, the expert emphasized that there was also a short-term price increase at that time BTC tried to make a golden cross. This is due to the fact that notable price movements have historically occurred immediately after the 1-day moving average forms a golden cross, which occurs when it sharply exceeds the weekly moving average.
In addition, the weekly moving average has temporarily been overtaken by the current daily moving average, with the current price at $66,400 levela section where support for the September high could be expected, as indicated by the black arrow on the chart.
As a result, Yonsei Dent expects the market to develop a clear bullish structure as long as the higher highs and lows, where the lows and highs have gradually increased since August, continue.
A possible price correction for BTC
While the Coinbase bounty could spark an impending short-term rally, Kyle Doops, a technical analyst and host of the Crypto Banter show, has pointed out a possible price correction for the flagship digital asset in the coming days. Kyle Doops’ pessimistic prediction is based on an analysis of Bitcoin‘s quarterly performance by contrasting market capitalization with realized cap, which revealed crucial patterns for the market.
After examining the metric, the expert warned of possible selling pressure and bearish signals if the market capitalization were to outpace growth realized roof. However, a steady realized limit during recessions can indicate a market bottom. “As trends echo into 2021, a price correction could be on the horizon,” he added.
Featured image from Unsplash, chart from Tradingview.com