The current trending Bitcoin price is above$28,000. This is 0.7% more than the previous 24 hours. This slight increase is due to the crypto market shifting beyond rumours about Binance CEO Changpeng Zhao being subject to a Red Notice warrant.
The market’s reaction to Elon Musk’s decision to replace Twitter’s bird symbol by a Shiba Inu symbol, a symbol of DOGE – the native symbol of the original meme cryptocurrency Dogecoin, also contributed to Bitcoin’s resilience.
The DOGE price jumped more than 30% to $0.1 for only the second time since December 2022.
Bitcoin growth outlook: 45.4 million non-zero balance wallets
According to the Bitfinex Alpha report, Bitcoin continues to be in high demand.
However, even though the benchmark cryptocurrency has reached a new high, small holders of BTC have seen their balance grow at the fastest rate since early 2021. Analysts commenting on the report about Bitcoin prices suggest that investors may need to be cautious in the near term.
#Bitcoin‘s balance addresses are now non-zero, despite the fact that the number active addresses on Bitcoin and daily transactions has been declining.
This indicates the need for caution and a market that is in transition– Bitfinex (@bitfinex). April 3, 2023
On-chain data shows that the number of non-zero addresses reached 45.388 millions last week, as Bitcoin price remained above$27k to close the first quarter on bullish notes.
This is a good development for Bitcoin price and the network. The increase in non-zero balance wallets indicates that investors are entering the Bitcoin market. An increase in nonzero balance holders is often a sign of new demand, especially from small investors.
Despite this optimistic outlook, some other metrics on the blockchain suggest that bulls should be cautious in short-term. The Bitfinex Alpha report reveals that the market is still in transition and indecisive.
“A transition state is characterized by unstable market conditions, where the price fluctuates between a narrow range and a steady trend. They noted that despite the influx of new market participants, the sustainability of this phenomenon of rapidly growing non-zero Bitcoin balances and tight range trading for Bitcoin is still uncertain.
BTC price – key metrics on-chain suggest weakness
Analysts at Bitfinex suggest that Bitcoin prices may continue to stabilize around $28 despite the fact that both bears and bulls are still indecisive.
You should be paying attention to key metrics on the blockchain such as bitcoin network statistics, daily active addresses, and confirmed transactions.
The 7-day moving average daily active addresses has dropped to levels not seen since late January. Also, the number of daily confirmed transactions has declined.
The Bitcoin network saw a 7-day average transaction volume of 293,058 transactions. This compares to the 8 March data which showed a 13% drop in transactions. These metrics were discussed by Bitfinex analysts:
This is a non-conclusive indicator for bullish or bearish signals. However, daily activity and transactions decreasing in Bitcoin have always been associated with transitional phases in the crypto market. These indicate indecision and a predicament that is unsettling for both bulls or bears.
Bitcoin’s relationship with S&P 500 – Is it rising again?
Bulls are trying to rise above $28k once more, but data shows that BTC’s correlation with stocks is growing after it fell significantly in March. The BTC price has outperformed the major US indexes over the month, and year-to date at the end Q1, 2023.
According to the Bitfinex report, and as CoinJournal analyst Dan Ashmore highlighted last Wednesday, Bitcoin is on track for restoring its correlation with S&P 500/NASDAQ composite as its price remains between $27k-$28k.
The Pearson metric shows that the correlation between BTC/NASDAQ and the S&P 500 is 0.61.
Any value greater than zero indicates a positive correlation. These figures suggest that Bitcoin could trade more in lockstep to equity indices during macroeconomic headwinds.