Chiara Bianchi
Bitcoin’s price has surged by almost 8% following a 50 basis-point rate cut by the U.S. Federal Reserve, according to an analyst from CryptoQuant. This rise has influenced a key market indicator known as the “supply in profit” metric, which points to the possibility of further price gains.
The “supply in profit” refers to the proportion of Bitcoin’s circulating supply bought at a price lower than the current market value. As this percentage increases, it signals that more holders are in profit, which can lower selling pressure and boost market confidence.
Julio Moreno, CryptoQuantโs Head of Research, explained to PRIME X that Bitcoin’s recent upward movement pushed the supply in profit metric above its 365-day moving average. “This turning point often signals additional price gains,” Moreno remarked, indicating that Bitcoin may experience further bullish momentum.
Bitcoin Surpasses a Key Psychological Level
In a blog post by CryptoQuant, it was noted that the supply in profit level often serves as an emotional benchmark for investors, functioning as a significant support or resistance zone. The post explained, “When Bitcoin’s price goes beyond this level, investor optimism tends to rise. Conversely, if it drops below, selling pressure may intensify.”
While the price rally has sparked optimism, analysts from Bitfinex have issued a word of caution. They noted that the initial surge was driven by spot market buying, but this activity has since slowed, as reflected by the leveling off of the cumulative volume delta (CVD), a metric that tracks the balance of buying and selling activity in the spot market.
“We anticipate Bitcoin will either consolidate near current levels or undergo a minor correction in the short term,” the Bitfinex analysts concluded in their recent report.
