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Bitcoin Price Dips, Here's a Positive Sign as Active Users Spike

Mon, 02/14/2022 - 09:45
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Tomiwabold Olajide
Bitcoin continues to demonstrate a solid mid-term increase in utility
Bitcoin Price Dips, Here's a Positive Sign as Active Users Spike
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According to on-chain analytics firm Santiment, a rise in Bitcoin daily active addresses might be a positive sign for the Bitcoin price. Bitcoin (BTC) sellers became active after buyers failed to sustain a break above $45,000 twice in the previous week.

Traders have already taken profits on the move, as Bitcoin hit a low of $41,570 on Feb. 14, but it has since risen somewhat to about $42,000 at press time.

According to Santiment, Bitcoin is continuing to demonstrate a solid mid-term increase in utility, with the biggest activity day being Feb. 12, when 1.08 million addresses were transacted on the Bitcoin blockchain. According to the on-chain analytics firm, an increase in participants transacting on the BTC blockchain is a positive sign of greater utility, which precedes price increases.

BTC price action

TradingView
BTC/USD Daily Chart, Source: TradingView

Bitcoin remains far away from last week's highs of $45,855 amid investors' concerns about ongoing inflationary pressure and growing tensions over a possible war with Russia; Ethereum and the bulk of the altcoins were also losing value at the time of publication. The Crypto Fear and Greed Index is currently at "fear."

The index, which uses a basket of factors to produce a nominal sentiment score from 0 to 100, measured 46 at the time of writing, having recovered to the ''neutral'' zone earlier.

Over the weekend, the largest cryptocurrency was restricted to a tight range and was nearly flat over the preceding 24 hours. Pullbacks could be stabilized if initial support at $40,000 is found. Bitcoin was trading at around $42,091 at the time of writing.

After a drop from the $45,855 level last week, Bitcoin stayed above the $41,914 support (MA 50) over the weekend. Bitcoin has shown strength this month after falling to lows of $32,950 on Jan. 24. BTC breached the resistance levels of $38,000 and $41,500 in the first week of February, reaching monthly highs of $45,855, levels last seen in late December 2021.

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About the author

Tomiwabold is a cryptocurrency analyst and an experienced technical analyst. He pays close attention to cryptocurrency research, conducting comprehensive price analysis and exchanging predictions of estimated market trends. Tomiwabold earned his degree at the University of Lagos.