Bitcoin's Profit Supply Reaches 85% Amid Bullish Trend

Bitcoin’s circulating supply in profit has reached over 85%, indicating a strong bullish trend and significant investor confidence. This metric, which measures the percentage of coin holders who acquired their assets at prices lower than the current market value, suggests broad investor optimism and robust capital inflows into the asset. As the profit supply approaches 90%, the market may be entering an euphoric phase, which historically has been followed by short-term corrections as traders lock in profits.

According to a report by a pseudonymous CryptoQuant analyst, the current trend represents a bullish signal. However, the analyst notes that while a large portion of the supply in profit is generally positive, it can also indicate that the market is nearing a local top. Historically, when the profit supply surpasses the 90% threshold, it has consistently triggered euphoric phases, which are often short-lived and followed by short- to medium-term corrections.

Despite the bullish sentiment, the market is currently in a state of anticipation, as indicated by Bitcoin’s neutral funding rate. The funding rate, which is a periodic payment between traders in perpetual futures markets, is currently at 0%. This neutral market sentiment suggests that investors are waiting for a catalyst to provide clearer direction, setting the stage for potential price volatility in the near term.

At the time of reporting, Bitcoin is trading at $95,125, just below a major resistance level of $95,971. The Relative Strength Index (RSI), which measures an asset’s overbought and oversold market conditions, currently stands at 68.21. This reading indicates room for further price growth before the coin becomes overbought. If demand strengthens, Bitcoin could break above the $95,971 resistance and rally to $98,983. However, if bearish sentiment grows, Bitcoin could resume its downtrend and fall to $91,851.

As Bitcoin navigates these crucial market phases, the balance between euphoric supply and market sentiment remains delicate. Currently, strong investor confidence contrasts with potential resistance levels, leading to a landscape of volatility. Timely awareness and strategic decisions will be essential as traders adapt to the ever-evolving Bitcoin market.