Data shows three popular Bitcoin momentum indicators recently formed a death cross pattern. Here’s what usually follows this formation.

Bitcoin Momentum Indicators Have Seen Bearish Crossovers Recently

In a new CryptoQuant Quicktake post, an analyst has discussed the latest trend in three momentum indicators related to Bitcoin. The momentum indicators here refer to combinations of some important moving averages (MAs) related to the cryptocurrency.

The first is the “Active Address Momentum,” which involves the 30-day and 365-day MAs of the daily unique number of BTC Active Addresses. An address is said to be “active” when it makes some transaction on the network, whether as a receiver or sender.

The number of Active Addresses may be the same as the number of users visiting the network, so this metric tells us how the blockchain activity is looking right now.

Here is the chart shared by the quant that shows the trend in the 30-day and 365-day MAs of the Active Addresses over the last few years.

As displayed in the above graph, the monthly average of the Active Addresses saw a cross under the yearly average shortly after the asset’s rally to the new all-time high (ATH) and has since remained under it.

This crossover implies activity on the BTC blockchain has been on the decline. Generally, user interest keeps rallies fueled, so an increase in Active Addresses is needed to keep any more sustainable.

As investors are starting to pay less attention to the cryptocurrency, conditions may not be right for a bull run anymore. The chart shows that this kind of crossover also occurred at the end of the bull run in the first half of 2021, although the second-half rally did occur regardless.

The second momentum indicator is the famous Market Value to Realized Value (MVRV) Ratio, which tells us whether the investors are in profit or loss.

As the chart shows, the MVRV Ratio has also seen its monthly cross below its yearly, suggesting investor profits have been shrinking. This pattern has historically served as a death cross, with BTC shifting towards a bearish phase following it. The same cross also appeared just before the 2022 bear market kicked off.

Finally, there is also the bearish crossover between the 50-day and 200-day MAs of the Bitcoin price itself.

Given all these negative patterns across the different Bitcoin indicators, the cryptocurrency may be heading towards at least a short-term bearish period.

BTC Price

Bitcoin has struggled recently as its price has dipped towards the $56,500 level.

Goldman Sachs, the leading financial giant, has issued a new research note. The note comprises new details on gold and how the AUX is emerging as the second-best-performing asset after crypto.

The analysts have also shared insights on gold being an incredible hedge against changing geopolitical narratives and how a new price target is already in sight for gold to claim and achieve.

Also Read: Investors Should Opt For Gold As FED Cut Looms Over: Goldman Sachs

Fresh Price Target For AUX

Current Performance And Price Target

In its new report, Goldman Sachs has shared a new price target for gold. Gold is up 22% this year and has recently crossed the $2500 mark. At press time, the precious yellow metal is at $2496, up 0.06%.

Hedge Against Federal Reserve Rate Cuts

Goldman Sachs analysts have also shared how the precious metal is the ultimate hedge against the looming federal reserve rate cut scenario, which may help safeguard investor assets and sentiments. The financial giant has strongly urged investors to opt for gold as an effective tool to fight inflationary pressure and the crisis.

“Our preferred near-term long-term is gold. It remains our preferred hedge against geopolitical and financial risks, with added support from imminent Fed rate cuts and ongoing EM central bank buying,” as shared by Goldman Sachs analysts.”

Future Price Predictions

According to the leading analysts at the firm, a new price target has been set for AUX for 2025. Per the experts, gold may surge to $2,700 if the present market momentum continues to fuel Gold’s surge.

Also Read: High-Risk High Reward: 3 Cryptocurrency Coins With 10x Gain Potential

Federal Reserve and Gold: An Undeniable Connection

Impact Of Interest Rate Cuts

Gold has often been considered an incredible hedge in times of financial crisis and turmoil. Recently, Jerome Powell, the Fed Chair, made new comments on how the interest rate cut scenario may finally materialize this September.

Effect On The Dollar And Gold Prices

In simpler terms, once the rate cuts are announced, the banks will lower borrowing costs, which may project the dollar as an unattractive asset to invest in on a global radar. This may propel a decrease in US stocks and assets, ushering in a surge in the prices of the precious yellow metal.

Analysts’ Views On Gold’s Importance

Goldman Sachs analysts have already outlined the importance of the yellow metal and how it can prove to be a perfect hedge during such stark market times.

Per Rashad Hajiyev, a notable financial analyst, Gold is already on its way to spiking and trading at a higher pedestal of $3,000 soon.

“Gold is in the advancing cycle, and so far it has rallied 23% after breaking out in late February 2024. Back in 2019, Gold formed a similar breakout and rallied 50% within 14 months.

So the present rally has a lot of room with my minimum target of $3,000.”

Gold is in the advancing cycle and so far in rallied 23% after breaking out in late February 2024. Back in 2019, Gold formed a similar breakout and rallied 50% within 14 months.
So present rally has a lot of room with my minimum target of $3,000… pic.twitter.com/SkCBD2iHrw

— Rashad Hajiyev (@hajiyev_rashad) September 1, 2024

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