Bitcoin's Demand Momentum Remains Subdued Despite Price Rally
While Bitcoin (BTC) has shown impressive price action recently - climbing from $85,ethereum price prediction 2024000 to nearly $95,000 within a week - underlying demand metrics tell a more cautious story. The cryptocurrency's Demand Momentum continues to linger in negative territory, suggesting investors remain hesitant despite the upward price movement.
Understanding The Current Demand Dynamics
CryptoQuant analyst Crazzyblockk's latest findings reveal Bitcoin's 30-day Demand Momentum currently stands at approximately -483,860 BTC. This metric, calculated by comparing Short-Term Holder (STH) supply against Long-Term Holder (LTH) supply, indicates net demand shifts in the market. The 30-day Simple Moving Average of this indicator remains similarly depressed at around -310,700 BTC.
When short-term holder supply increases relative to long-term holders, it typically signals growing speculative activity rather than conviction-based holding. The current negative reading suggests waning interest from short-term market participants, potentially due to profit-taking after recent gains or broader economic uncertainties including global trade tensions.
Historical Context And Potential Outcomes
Market observers note similar deep negative divergences occurred in mid-2021 and Q2 2022, both preceding significant price corrections. However, these periods ultimately marked market bottoms that preceded sustained bullish trends. Should Bitcoin reverse this negative demand trend, it could signal renewed investor confidence and potentially drive prices toward new highs.
Contradictory Signals Emerge
While Demand Momentum remains weak, other indicators paint a more optimistic picture. Bitcoin's Apparent Demand metric shows signs of recovery, suggesting potential buying pressure returning to the market. Exchange reserves continue declining at an accelerated pace, with recent data showing the highest withdrawal volumes in two years - a development that could create supply constraints supporting price appreciation.
Technical analysis suggests Bitcoin may test its current all-time high of $108,786 if current trends continue. At time of reporting, BTC trades at $94,773, showing modest 0.3% gains over the past 24 hours.
The market currently presents mixed signals, with weak demand momentum contrasting with positive technical indicators and supply dynamics. Market participants will watch closely to see whether Bitcoin can overcome this demand deficit and establish sustainable upward momentum.