Has Bitcoin reached its bottom? 88% of the supply already profitable

While the price of bitcoin has recently surpassed $65,000, many investors believe that the bottom may have already been reached. Technical indicators such as the MVRV ratio emit a positive buy signal, suggesting potential gains of 67%.

An Important Share of BTC Supply Still in Profit

The latest on-chain data reveals that 88.8% of the total supply of bitcoins is currently in positive territory. Although lower than earlier peaks this year, this percentage is historically high. The last time such a level was witnessed dates back to February 7, 2024, when BTC was trading around $44,000.

This significant proportion of holders in profit could generate some selling pressure and moderate the bullish momentum in the short term. However, many analysts remain convinced that if bitcoin succeeds in holding above $65,000, the positive trend could continue and push the price towards new highs.

“If the price breaks sustainably above $75k, it will likely confirm that the bottom is behind us. Conversely, a return below $58k would mean that the floor has not yet been reached,” comments trader Nebraskagooner.

Promising Technical Signals Despite Uncertainties

Despite these uncertainties, the bitcoin MVRV (Market-Value-to-Realized-Value) ratio seems to indicate an appealing buying window. This metric is used to assess if the price is overvalued or undervalued compared to its “fair value”.

According to analyst Ali Martinez, when this ratio falls below its 90-day moving average, it has historically offered excellent buying opportunities, with an average gain of 67% since November 2022. This pattern has just appeared again, suggesting that now might be a good time to accumulate BTC.

Martinez also highlights a recent decoupling between bitcoin and the global liquidity index. He believes that an increase in liquidity before the US elections will be necessary to support the bullish momentum. However, with rising transaction fees and a decline in address creation, mixed signals persist.

While the technical and on-chain setup of bitcoin suggests a promising bullish potential, caution is still advised in the short term. The high profitability level of the supply could trigger profit-taking. The forthcoming weeks will be crucial to confirm a sustained market reversal.