Underscoring Bitcoin's recent rally are strong on-chain trends, according to a number of analysts. 

On-chain Bitcoin specialist Willy Woo noted that while BTC is still far from its $20,000 all-time high, his NVT Price metric recently set a new all-time high. 

The NVT (Network Value to Transactions Ratio) Price uses on-chain trends to derive a valuation for Bitcoin other than the actual market price. More specifically, it takes the two-year moving average of Bitcoin's market capitalization, which is then multiplied by the daily transactional volume of the Bitcoin network.

Woo says that this measure provides an "organic valuation" of the leading cryptocurrency shaped by "underlying long-term investors." He believes the metric hitting an all-time high will result in Bitcoin breaking new records as well. 

A chart Woo shared indicates this is the case: prior to Bitcoin's two previous exponential rallies in 2013-2014 and 2016-2017, the NVT metric set a new all-time high and was then followed by the market price.

Further bolstering the bull case for Bitcoin, Woo pointed out that the largest concerted accumulation effort ever may be taking place amongst bitcoin holders right now. Since Bitcoin's March drop, hundreds of thousands of coins have been sent from exchanges to self-custodied wallets, presumably for long-term storage:

This coincided exactly with coins being scooped off exchanges and locked into long term HODL wallets. The largest by far in BTC's history. It still continues. While traders were selling Bitcoins, investors were accumulating. It's investors that determine the long term price.

Spencer Noon, analyst and head of DTC Capital, is bullish on Bitcoin's on-chain trends, too. 

Noon named seven crucial metrics, including the number of daily active addresses, daily fees collected by Bitcoin miners, and the percentage of bitcoin held for over a year, as reasons why he thinks Bitcoin is healthier than ever. 

Underscoring these trends are fundamentals that should drive increased investment into Bitcoin.

Last week, data released by the Federal Reserve indicated that its balance sheet has hit a new all-time high of $7.177 trillion worth of assets. $7.177 trillion is equivalent to approximately one-third of the U.S.' national GDP in 2019. 

At the start of 2020, this metric was closer to $4 trillion, implying the creation of over $3 trillion worth of liquidity in ten months alone.

Bitcoin stands to benefit from this trend as the U.S. dollar is being devalued. Bitcoin's rally over the past few months has coincided with a strong drop in the U.S. Dollar Index (DXY), while the strong Bitcoin correction in March was predicated on a spike in that same index. This historical correlation suggests that as the U.S. dollar continues to fall, assets such as gold and Bitcoin should rise. 

Adding to this, there has been a recent push towards central bank digital currencies (CBDCs) driven by the central banks of China, Spain, France, and countless other nations. To Raoul Pal, CEO of Real Vision and a retired hedge fund manager, Bitcoin is a "life raft" in a world where CBDCs are prevalent.

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