Bitcoin's Price Approaches New Heights

Bitcoin is flirting with its all-time high, boasting a Z-Score of +1.5σ. This signals strength, but it hasn't quite reached the +2.5σ threshold that indicates overheating. Thus, there’s potential for further gains before any momentum risks being overstretched.

The Activity-Price Discrepancy

Despite Bitcoin’s impressive price rally, the Activity–Price Divergence (APD) is alarmingly low at -1.5, indicating that price growth significantly outstrips actual on-chain activity. This gap suggests that while Bitcoin's price climbs, the underlying network fundamentals haven’t fully caught up.

Miner Behavior: A Supportive Influence?

Interestingly, miners appear to be providing much-needed stability to the market. The Miners’ Position Index (MPI) is at -0.46, meaning that their outflows are below the yearly average. Although there was a 25.8% increase in mining outflows recently, the overall selling pressure remains restrained.

The Scarcity Factor—Fuel for Growth?

Bitcoin's Stock-to-Flow (S2F) ratio has skyrocketed to 1.5923 million, marking a staggering 75% increase. Historically, high S2F readings have signaled bullish trends, as a tighter supply elevates investor confidence. This boost in scarcity coincides with a post-halving reduction in issuance, potentially amplifying demand across retail and institutional investors.

Rising On-Chain Activity—A Game Changer?

On-chain dynamics are showing positive signs, with new addresses increasing by 25.47% and active addresses up by 11.11% in just a week. Meanwhile, zero-balance addresses have diminished by 2.69%, suggesting a growing number of wallets are holding Bitcoin. This rise in user engagement enhances liquidity and solidifies market resilience.

The Bottom Line: Will the Momentum Sustain?

In conclusion, Bitcoin’s price momentum remains robust, bolstered by limited miner selling, an elevated Stock-to-Flow ratio, and increasing on-chain participation. However, with network activity still trailing behind the price, this gap needs to narrow for the bullish trend to sustain itself. If the fundamentals strengthen further through increased address activity and stable supply dynamics, Bitcoin could maintain its upward trajectory.