Bitcoin [BTC] Enters Accumulation Phase, But Active Addresses Fall

Bitcoin [BTC] has been persistently trading below the $60,000 mark, and recent data indicated that various entities have started accumulating

Bitcoin [BTC] has been trading below the $60,000 mark. Recent data showed that various entities started accumulating BTC during this price consolidation phase.

This strategic accumulation suggested that some investors viewed the current price range as a favorable entry point. However, there was a noticeable decrease in wallet activity during the same period.

Bitcoin enters the accumulation phaseAccording to AMBCrypto’s analysis of Bitcoin’s trend score from Glassnode, there was a marked reversal in market behavior.

The trend score, at 0.4 at press time, indicated a significant shift, suggesting that entities began accumulating BTC after a period of distribution.

This increase in the trend score, while not yet at 1, signaled a movement towards more aggressive accumulation. Also, this was the first time since April that the trend score reached this level.

The Accumulation Trend Score is particularly valuable as it not only considers the amount of BTC that entities are buying or selling but also the size of the entities’ balances.

A score approaching 1 implies that larger entities are actively accumulating BTC, a bullish signal. Conversely, a score near 0 suggests that these entities are either distributing their holdings or abstaining from further accumulation.

This upward movement in the trend score could potentially indicate growing confidence among larger investors.

Such behavior often precedes broader market recoveries, as significant accumulation phases by large holders can reduce market supply and help establish stronger price support levels.

Active Bitcoin addresses fallWhile there was a noticeable uptick in Bitcoin accumulation among larger entities, the number of daily active Bitcoin addresses told a different story.

An analysis of the active addresses chart on Glassnode revealed a sharp decline in activity recently.

However, despite experiencing fluctuations, the number of active addresses has largely remained within the 600,000 range. At press time, the number was around 669,000.

This decline in active addresses amidst increasing accumulation might suggest a few potential scenarios.

Firstly, larger investors could be holding their BTC for the long term, reducing transaction frequency. Also, it could indicate a cautious wider market, where fewer individuals and entities are engaging in transactions, possibly waiting for clearer signals before entering or exiting positions.

BTC trading below $60,000According to the latest data, BTC was trading at approximately $57,151, showing a slight decline of less than 1% on a daily time frame.

The price movement on the chart indicated that BTC was in a bearish trend.

This was evidenced by its position below the key moving average (yellow and blue lines). Also, BTC’s position, relative to the neutral line on the Relative Strength Index (RSI) at press time, further supported this bearish outlook.