The Role of On-Chain Metrics in Bitcoin's Price Movement: The God Candle

Bitcoin's latest price surge mirrors 2021's bull run, with potential for new all-time high. Institutional adoption and derivatives trading drive momentum.

Bitcoin's recent price movement is reminiscent of the first quarter of 2021 when the leading cryptocurrency set the stage for its all-time high of $69,044.77 in November of that year. With impressive gains in February and October, Bitcoin saw a 36% and 26% increase in value per month, respectively.

The latest price surge in February 2024 has outshone even the iconic run of 2021. Bitcoin experienced a 27.25% increase to reach $63,999, marking a three-year high after starting the month at $42,580. This represents a significant uptick of over $20,000 in just 30 days, making it the most impressive price surge in Bitcoin's history, surpassing the God Candle of October 2021 by $2.5K.

Following this surge, Bitcoin has maintained its bullish momentum and has reached daily highs of $66,353.63, with an additional 6.6% gain.

Many crypto enthusiasts are now eagerly anticipating whether Bitcoin will reach a new all-time high before its halving, while others are hopeful for a continuation of the upward trend seen in the 2021 bull rally. Analysts suggest that Bitcoin could potentially reach $213,000 if it sets a new all-time high, based on historical data.

The recent surge in Bitcoin's price is attributed to high demand in derivatives trading, with $3.87 billion of Open Interest (OI) volume added since Bitcoin broke above the $52,000 price range. In a bearish scenario, Bitcoin has strong support around the $55,000 price range, with $72.55 million in short-position liquidations in the past 24 hours. OKX traders are notably bearish on Bitcoin, with a 0.95 long versus short position ratio, and Bitcoin's Open Interest (OI) rate has surged to $31.22B, an 11.41% increase from the previous day.

Overall, the surge in Bitcoin's price, driven by institutional adoption and inspired by the Bitcoin ETF, marks a significant milestone as the cryptocurrency approaches its all-time high after a three-year hiatus.