Analyst Speculates on Bitcoin Price Rally
Bitcoin’s price has surged above $73,000, prompting speculation on whether the upward trend will continue. A recent analysis by CryptoQuant, a cryptocurrency analytics firm, sheds light on the potential for further growth.
The analysis focuses on the Short-Term Holder Return on Investment Ratio (SOPR), a critical metric used to evaluate the profitability of short-term Bitcoin holders. SOPR measures the profit margin of Bitcoin holders who have held their coins for a period of one hour to 155 days. A value above 1 indicates that a higher percentage of coins were sold at a profit, while a value below 1 suggests more holders sold at a loss.
According to CryptoQuant, the current Short-Term Holder SOPR is 1.017%, indicating that many short-term holders are making some profit, albeit not excessively. In previous market cycles, a SOPR value around 1.03% has been seen as a signal of overheating, suggesting that Bitcoin’s price may still have room to rise before reaching that point.
The analysis suggests that if the Bitcoin price continues to surpass recent highs and the SOPR value rises further, the market could experience a more significant rally. However, the upcoming US presidential election could introduce potential risks that investors should consider, as it may impact asset prices, including cryptocurrencies.
Please note that this article does not provide investment advice.
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