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Bitcoin has seen a significant price surge since Tuesday, following the Federal Reserve’s announcement of a 50 basis point interest rate cut. The move pushed Bitcoin past the critical $62,000 level, a psychological level that has become a turning point for investor sentiment. With Bitcoin now testing its domestic supply, market participants are closely watching for further upside.
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As the price continues to rise, analysts are pointing to crucial data that suggests a potential reversal in Bitcoin’s trend after months of bearish price action. Glassnode metrics reveal a notable trend change, suggesting that Bitcoin may be entering bullish territory once again. This recovery is attracting increased attention from both individual and institutional investors as they assess whether Bitcoin’s rally has the potential to stay in place or if the market will face resistance at higher levels.
With renewed momentum, the coming days will be crucial in determining whether Bitcoin is able to maintain this upward trajectory and fully break out of its previous bearish phase.
Bitcoin signals bullish comeback
Bitcoin investors have seen a major shift in sentiment from fear to hope in just a few days. Following the Federal Reserve’s interest rate cut announcement on Wednesday, Bitcoin’s value surged more than 8%, breaking through critical levels and testing local supply. The sudden price move has sparked renewed optimism in the broader cryptocurrency market, giving investors hope for a fresh start after months of bearish price action.
Prominent cryptocurrency analyst Ali Martinez shares Valuable insights about XAli draws attention to key data from Glassnode that points to a major shift in Bitcoin’s price direction. Specifically, he highlights the market cap to real value (MVRV) ratio, which tracks the difference between Bitcoin’s market price and its actual value.
The MVRV ratio, which has been in a downtrend since April, is now rising, suggesting that Bitcoin may regain its strength. Ali notes that the MVRV ratio is a crucial indicator for assessing momentum, and that the current uptrend signals a potential return to the bullish zone.
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The analyst further explains that if MVRV manages to close above its 90-day moving average, it will confirm a stronger bullish outlook for Bitcoin. Given the sharp price surge and the increased demand reflected in recent price action, this scenario is looking increasingly likely. Investors are now watching closely, as Bitcoin’s next move could mark the beginning of a new bullish phase.
Technical levels to watch
Bitcoin (BTC) is trading at $63,024 after days of “only bullish” price action since hitting local lows. The price recently broke the 200-day exponential moving average (EMA) at $59,350 and is now testing the critical 200-day moving average (MA) at $63,954.
This 200-day moving average is a long-term leading indicator, indicating the strength of the overall market. If Bitcoin can reclaim this level as support, it is likely to lead to a significant price surge, reinforcing the bullish outlook.
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For bulls to maintain momentum, the next target will be around this critical level, with a potential push towards $65,000, a price last tested in late August. However, if Bitcoin fails to hold above $60,000 in the coming days, investors could see a pullback to lower demand levels. The ability to hold above key support areas will determine the next phase of price action.
Featured image by Dall-E, chart by TradingView