• Price gap on the CME followed a historic pattern, pointing to why BTC could register a surge
• Growing address balances among holders, alongside several sentiments in the derivatives market, pointed to a hike in buying activity

A brief period of market correction saw Bitcoin [BTC] drop into the $70,000-zone on the charts. This wasn’t to last, however, as a rebound soon after allowed the cryptocurrency to gain by 7.12% in the last 24 hours.

In fact, an analysis of key metrics revealed that the asset might likely reverse the 19% monthly losses too. Especially if the buying sentiment continues to build.

CME gap hosting movement — Opportunity ahead for BTC?

The CME gap acts as a liquidity point in the market, formed due to the price difference between where the market opens and where it closed. This is typically influenced by the fact that the CME doesn’t trade on weekends or holidays.

When a gap is formed, the price tends to trade back to that level.

As per AMBCrypto’s assessment, BTC could be trailing its 2020 pattern. At the time, after the price reached a high above $12,000, it saw a sharp 22.43% decline to fill the CME gap below. This, before finally setting an all-time high far beyond that level.

Bitcoin has taken the same path recently after declining by 28.57% into a CME gap between 80,670 and 77,930. Depending on their position, these gaps could act as demand and supply levels – In this case, a demand level.

The aforementioned chart also revealed that a rebound from this level would lead BTC to trade close to the short-term target of 92,755—where another CME gap lies—and a long-term target crossing the previous all-time high recorded on the CME chart at $110,150.

Worth pointing out, however, that AMBCrypto also found other bullish confluences in the market that support a move up from the press time price.

Multiple bullish confluences surface

There’s been a surge in addresses holding BTC over time. Currently, a shift is occurring, with cruisers (addresses that have held for 1-12 months) and traders (less than a month) declining, while holders (addresses holding for more than a year) are increasing.

This means that long-term holders are beginning to surge, reducing supply in the market and avoiding impulsive trade movements. At the time of writing, holder addresses had climbed to 39.26 million.

Similarly, the Unspent Transaction Output (UTXO) revealed bullish sentiment among transactions that have occurred within the last 24 hours and between a day to one week. 

Bitcoin transactions that occurred less than a day ago and haven’t moved surged by 26.07% to 216,520 BTC, while transactions yet to move within a week grew by 52.40% – Hitting 322,990 BTC.

If this trend continues, it would mean that market participants are acquiring BTC for long-term holding, rather than immediate sell-offs.

In fact, derivative traders in the market share the same bullish sentiment. Especially on the back of Bitcoin’s Open Interest climbing subtly by 2.80% to $50.91 billion in the last 24 hours.

This bullish sentiment was confirmed by the long-to-short ratio. This metric, which measures buying volume (above 1) and selling volume (below 1) in the derivatives market, recorded a reading of 1.0072.

If this ratio crosses further above this level, it would indicate that more buying activity is ongoing in the derivatives market. This would mean that BTC is likely to trade higher.