Bitcoin (BTC) has once again crossed the psychological barrier of $61,000, a move that has sparked both excitement and caution among traders. As of press time, BTC was trading at $61,173.50 with a market capitalization exceeding $1.2 trillion. This latest surge comes despite a slight price drop in the past 24 hours, raising concerns about the sustainability of this rally.
The Current Landscape
According to data from IntoTheBlock, more than 44 million Bitcoin addresses are currently in profit, representing over 82% of all BTC addresses. This high percentage of profitable addresses usually indicates a strong bullish sentiment; however, it can also lead to increased selling pressure if investors decide to cash out their gains.
Crypto analyst Ali recently shared a crucial support level for Bitcoin on social media. He highlighted that BTC needs to maintain its value above $60,365. A dip below this threshold could trigger a further decline, potentially dragging Bitcoin down to $57,000 in the coming days.
Analyzing the Odds of a Correction
With concerns about support levels looming, AMBCrypto took a closer look at Bitcoin’s on-chain data to gauge the likelihood of a price correction. Recent metrics from CryptoQuant revealed that BTC’s exchange reserves are on the rise. Typically, an increase in exchange reserves signifies that selling pressure is mounting, often leading to price corrections.
However, not all indicators suggest bearish momentum. For instance, Bitcoin’s Adjusted Spend Output Profit Ratio (aSORP) has shown that more investors are selling at a loss, which often signifies a market bottom during bearish phases. Furthermore, Bitcoin’s Coin Days Destroyed (CDD) metric indicated that long-term holders have been less active than average over the past week, suggesting a reluctance to sell.
The derivatives market is also showing positive signals. Bitcoin’s funding rate has been on the rise, and the taker buy/sell ratio indicates a stronger demand among futures investors. These factors point to a prevailing buying sentiment that could counteract selling pressure.
A Bullish Signal on the Horizon?
Adding to the optimism, Bitcoin’s price is nearing the lower limit of the Bollinger Bands. Historically, when the price approaches this lower limit, it often precedes a price rise. If this trend continues, Bitcoin could target resistance around $65,000 in the upcoming days.
As Bitcoin oscillates around the $61,000 mark, traders face a dichotomy of hope and caution. While the coin has shown resilience and a strong profit ratio among addresses, the critical support level of $60,365 remains a significant point of concern. The interplay between rising exchange reserves and optimistic sentiment in the derivatives market will be crucial in determining whether Bitcoin can maintain its recent gains or if a correction to $57,000 is inevitable.
Also Read: Bitcoin’s Final Dip? Analyst Predicts 20% Rebound After Key Support Holds
In this volatile landscape, investors should remain vigilant, balancing the potential for gains with the risks of price corrections. The next few days
