Bitcoin (BTC) is up nearly 8% in response to the Federal Reserve’s 50 basis point rate cut, according to research firm CryptoQuant. A key market indicator suggests more gains could be on the horizon.
Market Reaction to Rate Cut
Bitcoin demonstrated significant growth following the Federal Reserve's decision to cut rates by 50 basis points. This decision acted as a catalyst for the leading cryptocurrency's price increase.
'Supply in Profit' Metric as an Indicator
The 'supply in profit' metric measures the percentage of Bitcoin's circulating supply that was generated at a price lower than its current market value. When this percentage increases, it signals that more holders are in profit, which can reduce selling pressure and boost market confidence.
Future Predictions
The supply-in-profit level often serves as an emotional gauge for investors, acting as a critical support or resistance zone. When the price breaks this level, optimism tends to rise; if it breaks below it, selling pressure may intensify.
The recent rise of Bitcoin above its 365-day moving average may signal a continuing upward trend. However, investors should remain vigilant and consider potential market fluctuations.
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