Bitcoin Price Set For Major Breakout? Coinbase Premium Signals Imminent Move
Recent analysis from CryptoQuant highlights that Bitcoin price may soon undergo a significant move, according to an indicator known as the Coinbase Premium.
A CryptoQuant analyst under the pseudonym ‘Avocado Onchain’ noted earlier today that the Coinbase Premium, which measures the price gap between Bitcoin on Coinbase and Binance, is showing signs of convergence.
The narrowing of this premium suggests that Bitcoin’s price is approaching its fair value, leading many to believe that a decisive move is imminent.
How Does The Coinbase Premium Suggest Big Move Ahead For Bitcoin?
The Coinbase Premium reflects the difference in Bitcoin’s price on Coinbase compared to other exchanges, primarily Binance. When this premium is high, it suggests that US institutional investors, who often favor Coinbase, are buying more Bitcoin, pushing the price higher.
Conversely, a low or negative premium indicates that these investors are either selling or that demand is higher on other exchanges like Binance.
Avocado Onchain identified that the Coinbase Premium has gradually been narrowing in the past few weeks, with the price gap between Coinbase and Binance shrinking.
According to the analyst, this convergence creates a triangular pattern on the one-hour chart, signaling that a decisive price move is approaching. While the direction of this move remains uncertain, previous instances of such convergence patterns have led to significant upward price movements in Bitcoin.
For instance, the analyst mentioned that a similar pattern was observed during the 2021-2022 bull market, with the Coinbase Premium forming a triangular convergence. The moment this pattern was completed, Bitcoin’s price surged to new all-time highs.
The analysis noted:
I believe that the current triangular pattern in the Coinbase Premium reflects a standoff among large investors (whales), as they cautiously gauge each other’s moves before the next major price shift.
BTC Market Performance And Outlook
After previous attempts, Bitcoin could once again trade above the $58,000 mark earlier today with a 24-hour high of $58,435.
However, according to the latest data, the top crypto has now corrected as it trades below it with a current trading price of $57,619 at the time of writing, though still up by 1.5% in the past day.
Renowned crypto analyst Tony “The Bull” on X has recently identified the fractality of Gold in the Bitcoin price chart.
Tony noted that should this trend continue, a $100,000 price target could be coming over for Bitcoin in the next six months
If #Bitcoin continues to follow this #Gold fractal, $100K is coming over the next six months
RSI and SuperTrend exhibit similar behaviors, albeit on vastly different timescales pic.twitter.com/l1wmMZzudg
— Tony “The Bull” Severino, CMT (@tonythebullBTC) September 12, 2024
Featured image created with DALL-E, Chart from TradingVire
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