Bitcoin’s price has soared to a crucial milestone of $64,000, marking its first visit to this level since August 9. This impressive rally comes after a significant rebound of over 20% from its lowest point earlier this month. The driving force behind this surge? Wednesday’s decision by the Federal Reserve to cut rates by 50 basis points, along with hints of more cuts to come later this year.

Recent analysis from CryptoQuant’s Crypto analyst Datascope highlights important trends in Bitcoin’s market. As the “Supply in Profit” metric declines, it shows how many investors are losing money.

Understanding Supply in Profit

According to Datascope, the “Supply in Profit” is a crucial on-chain metric that shows how much of the current Bitcoin supply is profitable at its current price. This metric, illustrated in blue on charts, closely correlates with Bitcoin’s price fluctuations. When Bitcoin’s price rises above the purchase prices of investors, the profitable supply increases.

However, recent trends reveal a significant decline in this profitable supply due to a recent drop in Bitcoin’s price. This situation indicates that many investors are currently facing losses. 

Interestingly, those who are still in profit are reducing their selling pressure, which helps stabilize the market. This decline in profitable supply suggests that many investors are in the loss zone, potentially signaling a reversal opportunity for Bitcoin.

Is Bitcoin Poised for a Breakout?

As noted by Datascope, the Supply in Profit metric is getting close to the Psychological Inflection Line. This line represents important levels that investors feel strongly about and often serves as key support or resistance. These psychological levels are crucial for influencing how investors feel about the market.

If Bitcoin’s price goes above this line, it could create a sense of optimism among investors. On the other hand, if it drops below this line, we may see more selling, which could harm overall market sentiment.

Also Check Out: US Election 2024: Who’s Better for US Crypto Market Donald Trump or Kamala Harris?

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