If this happens, Bitcoin may open new local highs: CryptoQuant

This week, Bitcoin (BTC) touched $64,000 before retracing its move below $62,000. This price drop begs the question – will the main crypto asset break new highs in the near future?

CryptoQuant's leading analyst has shared a study that shows how the crypto asset can maintain its current price range and open higher levels.

Bitcoin at a critical psychological turning point

Historically, market participants have been disillusioned when their BTC holdings experienced losses after significant price declines. Conversely, investors are optimistic when their BTC portfolio is in the green zone.

CryptoQuant's leading analyst emphasized that the cryptocurrency is currently between a “critical psychological turning point and a zone of optimism.” This is the level at which the psychology of market participants drives or rejects the movement of Bitcoin. Emphasizing the importance of BTC staying in the bright zone, the analyst wrote:

“Historical data shows that maintaining stability in these critical zones is critical to the continuation of a bull market. In particular, the ‘Supply at Profit' measure, which reflects when investors take profits, shows that optimism increases when large amounts of supply are profitable. Bitcoin's current price level is now testing this optimism zone.” is it.”

In past market cycles, Bitcoin has been stable between these two zones, the analyst explained, which has led to continuous price increases. The CryptoQuant expert added that as long as BTC remains in the bright zone, the price may rise to new local highs.

Will BTC be optimistic?

While Bitcoin fans are hoping for a bullish market trend, BTC may not have the much-anticipated growth. This is the reason.

There is talk that the United States government plans to sell 69,370 BTC seized from the dark web market Silk Road for an estimated $4.3 billion. As seen in the BTC sell-off in Germany earlier this year, if the government implements the plan, it could create a bearish trend for the bitcoin market.

American stockbroker Peter Schiff of Microstrategy's Michael Saylor suggested that bitcoin stocks should be bought to avoid a major hemorrhaging of the asset's value.