Correlation between Bitcoin transaction fees and price
With the recent surge in the price of Bitcoin the sentiment on social media has totally changed again from super bearish to ultra positive. Some influencers (especially on Twitter/X) are calling for 1 Mio USD per Bitcoin in 2024...
While being (very) positive for Bitcoin myself in the long run the swing trader in me is calling for caution as the markets rarely do what the majority of people expect from it - at least short term.
I think one of the catalysts that could short term lead to a pull back of the price of Bitcoin of maybe 10 or 20 % are the transaction fees you currently have to pay per Bitcoin transaction. While there is no direct correlation between the fees and the price you can see on the chart that when the total spending per day on fees reaches more than 7 million USD, the price of Bitcoin sooner or later corrects to the downside.
I am not calling for a crash here down to 25k or even 20k, but a correction to the range of 35k to 38k would, imho, be healthy because it would shift the sentiment for Bitcoin away again from ultra bullish to more neutral or even bearish levels.
Lets see what the next couple of days and weeks will bring...
While being (very) positive for Bitcoin myself in the long run the swing trader in me is calling for caution as the markets rarely do what the majority of people expect from it - at least short term.
I think one of the catalysts that could short term lead to a pull back of the price of Bitcoin of maybe 10 or 20 % are the transaction fees you currently have to pay per Bitcoin transaction. While there is no direct correlation between the fees and the price you can see on the chart that when the total spending per day on fees reaches more than 7 million USD, the price of Bitcoin sooner or later corrects to the downside.
I am not calling for a crash here down to 25k or even 20k, but a correction to the range of 35k to 38k would, imho, be healthy because it would shift the sentiment for Bitcoin away again from ultra bullish to more neutral or even bearish levels.
Lets see what the next couple of days and weeks will bring...