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With the highly anticipated Bitcoin halving event less than a month away on April 19th, crypto analysis firm Santiment has outlined three key metrics for investors to monitor. These could signal ideal setups for potential price movements around the supply-tightening event. In a recent post, Santiment advises market participants to keep tabs on the following:

  1. Rising Trading Volume and Bitcoin Social Dominance One metric to watch is increasing trading volume and Bitcoin’s social dominance metric. These can indicate when FOMO (fear of missing out) is starting to take hold among investors, which often precedes price rallies.
  2. Spikes in Realized Profits Another key indicator is tracking when huge realized profit-taking occurs on the Bitcoin network. Santiment suggests being among the first to spot these spikes could forewarn of imminent price reversals or pullbacks.
  3. Whale Holdings vs. Small Addresses Finally, the firm recommends monitoring whether whales (large Bitcoin holders) continue accumulating and increasing their share of the total supply, while small addresses sell off. This dynamic has historically been an “ideal setup for bullish markets.”

The halving is when the Bitcoin protocol cuts in half the rate at which new BTC is issued as a reward for miners. This systematically slows the supply issuance rate to keep inflation low.

With less new BTC hitting markets, the halving has sparked major bull runs in past cycles amid the prospect of decreasing supply against rising demand from new buyers. However, it remains to be seen if the same bullish price reaction will occur this time around.

By keeping close watch on trading activity, profit-taking, and holder composition using the metrics highlighted by Santiment, investors may be able to better position themselves ahead of potential volatility around the halving.

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