Today – As confirmed by CryptoQuant, a notable divergence has recently formed between the price of the Coinbase (NASDAQ:) Premium Index and . Despite the significant rise in Bitcoin prices, this divergence is tilted to the negative side.
Bitcoin price soars and Coinbase Premium Index falls
For many years, short-term price trends have been predicted using momentum analysis with moving averages (MAs). However, as the market evolves, other measures are also being adopted.
Over the past two weeks, there has been a noticeable divergence between the Coinbase Premium Index and the price of Bitcoin. This divergence occurred when the price of BTC rose from $94,000 to $108,000. The flagship cryptocurrency is currently trading at $104,097.77, down 2.4% at the time of writing.
For context, the Coinbase Premium Index reflects the demand for Bitcoin in the United States. This is calculated by tracking activity on major US crypto exchanges Coinbase and Binance. The rise in premium suggests an increase in buying demand from US investors.
Coinbase Premium's decline raises serious concerns. This coincides with a season in which North American investor demand continues to surge. The launch of a Bitcoin exchange-traded fund (ETF) in January 2024 and recent macroeconomic developments have led to a shift in sentiment.
According to blockchain analytics platform CryptoQuant, “If U.S.-based demand is not supporting this price rally, it could indicate fundamental weakness in medium-term upward momentum.” There is.
Based on this outlook, we recommend that investors remain cautious and closely monitor this development.
Bitcoin price may or may not skyrocket
A week ago, the situation was quite different, as U.Today reported that Coinbase premiums had soared as Bitcoin prices plummeted.
Despite the price reversal amid rising ATH, the market is expecting a significant rebound in the short term. From a medium-term perspective, attention is focused on the weekly candlestick's closing price of $105,149.
If a false breakout occurs, Bitcoin price risks falling to a new low of $100,000.
This article was originally published on U.Today
