The crypto market is in turmoil with sensational news: 95% of Bitcoin addresses are now profitable. This exceptional situation has generated extremely positive market sentiment, but it also raises questions about the sustainability of this bullish momentum.
Bitcoin: historic bullish momentum!
Historically, when the majority of Bitcoin addresses are in profit, it has often been a sign of strong bullish momentum. Investors see their portfolios grow, which builds confidence and attracts new capital to the market.
Currently, over 51 million Bitcoin addresses are in profit, having acquired their assets at a price below $67,300. This situation reflects growing adoption and widespread optimism among investors.
The risks of overheating
However, this euphoria is not without risks. Such a level of profitability may also indicate an overextension of the Bitcoin market. When too many investors are in profit, the market can become vulnerable to sudden corrections.
Short position liquidations have already led to rapid price movements, affecting nearly 44,000 traders in just 24 hours. These liquidations can create a feedback loop where prices rise quickly, but can also fall just as quickly.
Factors contributing to the rise in bitcoin prices
Several factors contributed to this rise in BTC prices. Liquidations of short positions played a key role, but the influx of funds into Bitcoin exchange-traded funds (ETFs) in the United States was also significant. In one week, these ETFs saw inflows totaling approximately $555.9 million. This influx reflects not only growing institutional interest, but also broader acceptance of cryptos in the traditional financial landscape.
In short, current indicators show strong upward momentum, but investors should remain cautious. Careful analysis of market movements and underlying factors is essential to navigating this period of increased volatility. The crypto market is known for its rapid swings, and only time will tell if this Bitcoin uptrend will continue or if a correction is imminent.
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