Earlier this week CNBC Fast Money host Brian Kelly said he is short-term bearish on Bitcoin price based on a drop in daily active addresses. Does this mean BTC will drop lower?
Bitcoin bobs and weaves
Bitcoin has spent the last week bobbing and weaving at the $10K line. $10,350 stood as a stiff resistance level for nearly 3 days, then when overcome, $10,500 delivered the uppercut that smashed BTC back to a former resistance turned soft-support.
Unsurprisingly, Bitcoin price failed to find firm footing at $10,350 and overnight the digital-asset tripped and fell below $10k again.
At the time of writing, BTC is mustering up strength and attempting to have another go at the resistance level at $10,200 but the lack of bull volume calls the sincerity of this move into question.
Brian Kelly says, keep an eye on active addresses
Investor sentiment is growing increasingly bearish regarding Bitcoin price action and since the fall from $13,800 and repeated rejections in the $12k zone it seems a drop to low 9s and below is becoming a real possibility.
CNBC Fast Money host Brian Kelly seems to agree. Earlier this week Kelly said Bitcoin has been in this correction for a while and the lack of “supporting fundamentals” is why the digital asset has failed to retake $13,000.
Kelly explained that he assesses Bitcoin’s price action by keeping an eye on daily active addresses. Since June / July the 30 daily moving average for active daily addresses have dropped sharply.
BK says this metric is just as important as the daily and monthly active user rate for social media platforms.
He posits that this data supports his belief that Bitcoin’s price “got ahead of itself” and is cooling off after a high energy parabolic run from $4,000 to $13,800.