The rise in active addresses on the Bitcoin network, nearing the highest levels in three months, has sparked speculation about a potential market recovery following the current correction phase. As of February 28, the number of active addresses on the Bitcoin network surpassed 912,300, approaching levels observed in December.
Increase in Active Addresses
The crypto analytics platform IntoTheBlock noted that the surge in on-chain activity correlates with market peaks and troughs. This increase is interpreted as a result of panic-selling by some investors and opportunistic buying by others. The platform suggests that the market could recover following the panic-driven selling behaviors.
Historically, spikes in on-chain activity have reflected market peaks and troughs, driven by panic sales and opportunistic developments.
Support Levels and Technical Indicators
Stella Zlatareva from the crypto asset investment platform Nexo emphasized that Bitcoin maintaining a price above $80,500 is crucial for market stability. According to Zlatareva, surpassing this level could generate positive momentum, while failure to do so could lead to further price declines. If Bitcoin’s price drops below $84,000, experts warn that $1 billion in leveraged long positions across all exchanges may be liquidated, indicating continued short-term volatility.
Stella Zlatareva stated, “Maintaining the $80,500 level will be decisive for short-term momentum.” Among the technical indicators, the MVRV Z-Score suggests that Bitcoin’s price is nearing historical lows and has entered an oversold zone. This data implies that careful monitoring is needed before the market experiences any sudden recovery.
As investors closely track the rising number of active addresses and technical indicators, they signal potential reversal trends. While support levels and technical data are crucial for investors, the overall market trajectory remains uncertain.