The Bitcoin (BTC) market is currently sending mixed signals. On-chain data points to stability and caution, making it unclear whether the coin is heading for a high of $64,500 or aiming for a low of $49,500.
This article looks at these on-chain metrics, what they mean, and what investors should pay attention to.
Bitcoin Holders at the Crossroads
The first key metric to examine is Bitcoin’s Net Unrealized Profit and Loss (NUPL)m, which measures overall investor sentiment and profitability. The NUPL is currently 0.45, meaning that if investors sold their coins at current market prices, they would, on average, make a 44% profit compared to the price at which they last purchased their coins.
This level reflects moderately positive market sentiment.
However, CryptoQuant reports that the current value of NUPL BTC suggests that holders are hesitant to sell. This concern is driven by uncertainty surrounding the upcoming Consumer Price Index (CPI) release, a possible 50 basis point interest rate cut by the Federal Reserve, and the upcoming US presidential election.
Despite this, many long-term BTC holders are exhibiting strong HODLing behavior. This is reflected in the coin’s Binary Coin Days Destroyed (BCD) metric, which indicates that long-term holders are not moving their coins.
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At the time of writing, this figure stands at 0.28, reflecting confidence in Bitcoin’s performance and market stability as holders feel no need to move or sell their coins.
The combination of NUPL and BCD BTC indicates a clear sentiment: investors are concerned about a possible price drop, but the fear of missing out on future profits is keeping them from selling.
BTC Price Prediction: Rise Above $60,000 or Fall to $49,000?
In a note to clients, Marcus Thielen, founder of 10X Research, warned that uncertainty surrounding the US presidential election, the CPI and the FOMC meeting will largely determine Bitcoin price targets.
“Lower CPI numbers could also provide a temporary boost to the upside. However, with next week’s FOMC meeting expected to add further uncertainty and the outcome of the US election still uncertain after a possible surge in Trump optimism (Tuesday debate), Bitcoin may continue to search for more reliable support to achieve a more significant rally by year-end,” Thielen wrote.
A more negative position is taken by the founder and CEO of Quantum Economics Mati Greenspan. The expert believes that it is too early to think about new highs.
“Bitcoin’s price action has been in a sideways trend for over half a year now, and there’s no telling when it might break out. Ultimately, this sideways movement is good for bitcoin adoption, as price stability can be a key driver of growth and reliability,” Greenspan told BeInCrypto.
If the macroeconomic trends are favorable, the increase in demand for BTC will push its coin towards the $64,520 support level. If it exceeds this level, the leading coin may target $68,599.
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However, if bearish macroeconomic trends prevail, Bitcoin price could fall to its August 5 low of $49,516.
