Are we witnessing the dawn of a new price rally?

Bitcoin experienced a lot of sideways trading in January. The leading cryptocurrency fell to a short-term low of $38,500, its lowest in two months, before retracing its steps above $43,000. However, the latest data shows that prices are rising as long-term holders' activity is measured.

Short-term bitcoin holders may have capitalized on gains made during last month's mild rally, but long-term cohorts have remained firm, with rising binary CDD data volume as noted by CryptoQuant analyst ‘Mignolet'.

Bitcoin bullish signals

Binary CDD data, along with the 182-day moving average, provides insights into the beginning of a bullish trend. The analysis indicated that the data is higher than the stock period, which essentially indicates that a higher price cycle may begin.

Binary CDD, or Coin Days Cleared, serves as a key metric that reflects the movement patterns of long-term bitcoin holders. Within this framework, a large amount of binary CDD data shows repeated activities by these owners. Interestingly, this pattern reflects the cyclical nature of Bitcoin's price movements.

During up cycles, long-term holders' movements intensify as prices rise. On the contrary, in downward cycles, this activity decreases. This cyclical pattern has been echoed in previous market cycles, underscoring the importance of understanding the direction of the larger digital asset.

Binary CDD data density is increasing.

“Still worth tracking, but finally, out of this range” by @mignoletkr

Full post👇 pic.twitter.com/mCYWDyocL9

— CryptoQuant.com (@cryptoquant_com) February 5, 2024

CryptoQuant's analysis also confirmed that Bitcoin has been freed from previous range restrictions. If this threshold is decisively exceeded, a full upward price cycle may ensue.

Bitcoin stock trends

The latest forecast comes amid strong demand for Bitcoin. Moreover, Bitcoin whales are actively collecting and increasing their holdings to a high level.

In fact, last week, large wallets increased while smaller addresses fell. Santiment analysis shows that 47 more wallets appeared, holding 1k-10k BTC, representing a growth of 2.5% in the same period, while addresses with 100-1k BTC decreased by 1.1%.