Bitcoin (BTC) is currently fluctuating near its all-time high, with a Z-Score of +1.5σ – a strong indication, but still below the +2.5σ threshold considered 'overheated'. This opens up the possibility for further increases before momentum risks being exhausted.
However, the Activity-Price Divergence Index (APD) remains at -1.5 after recovering from -2, indicating that price growth is still outpacing on-chain activity. The gap between price and the network's fundamental factors has narrowed, but has not yet been fully addressed.
The role of miners in the market
It can be seen that miners are quietly supporting the market by reducing selling pressure. The Miners' Position Index (MPI) is currently at -0.46 at the time of reporting. This suggests that outflows from miners are still below their annual average. Although the MPI has increased by 25.8% in the past 24 hours, it still reflects somewhat limited selling behavior.
The reduction in selling pressure from miners may help maintain market stability, especially during periods of high volatility.
The impact of scarcity on price momentum
At the time of writing, the Stock-to-Flow (S2F) ratio has risen to 1.5923 million, marking a 75% increase and reinforcing Bitcoin's appeal in terms of scarcity. History shows that high S2F indicators are often accompanied by bullish phases when tight supply increases investor confidence.
This follows the post-halving supply reduction, which could increase demand due to scarcity from both retail investors and institutions.
On-chain participation and its impact on price
On-chain activity has seen significant improvements, with the number of new addresses increasing by 25.47% and active addresses rising by 11.11% in a week. The number of addresses without a balance decreased by 2.69%, indicating that more wallets are holding BTC.
This growth not only expands the user base but also deepens liquidity and strengthens the market's resilience. If this trend continues, it could narrow the gap between price and activity while reinforcing long-term price support.
In summary, the price momentum of Bitcoin remains very strong, supported by reduced selling pressure from miners, high Stock-to-Flow ratio, and increasing on-chain participation. However, network activity still lags behind price, leaving a gap that needs to be closed to ensure sustainable growth.
If the fundamental factors continue to strengthen through increased address activity and stable supply dynamics, the bullish trend may maintain its momentum. Conversely, prices may need to adjust to align more closely with on-chain performance.