Bitcoin Could Unlock New Local Highs if This Happens: CryptoQuant

This week, bitcoin (BTC) touched a price height of $64,000 before retracing its steps to a current price mark below $62,000. This price downtrend begs the question – will the leading crypto asset unlock new heights in the near term?

A CryptoQuant analyst has shared research showing what could enable the leading crypto asset to maintain its current price range and even unlock higher levels.

Bitcoin at a Critical Psychological Turning Point

Historically, market participants have turned pessimistic when their BTC holdings have experienced losses after a sharp price decline. Conversely, investors are optimistic when their BTC portfolio is in the green zone.

The CryptoQuant analyst stressed that the leading cryptocurrency is currently between a “critical psychological turning point and a zone of optimism,” a stage where market participants’ psychology can drive or plunge bitcoin’s movement. Emphasizing the need for BTC to remain in the optimism zone, the analyst wrote:

“Historical data shows that maintaining stability in these critical zones is crucial for the continuation of bull markets. Specifically, the “Supply in Profit” metric, which reflects the period when investors are in profit, indicates that optimism tends to rise when a significant portion of the supply is in profit. Bitcoin’s current price levels are now testing this zone of optimism.”

During past market cycles, bitcoin was steady between these two zones, as the analyst highlighted, leading to continuous price uptrends. The CryptoQuant expert added that as long as BTC remains in its optimistic zone, its price could soar to new local heights.

Will BTC Remain Optimistic?

While bitcoin proponents hope for a bullish market trend, BTC may fail to live up to its much-expected growth. Here’s why.

There are talks about the United States government planning to sell 69,370 BTC worth approximately $4.3 billion seized from the dark web marketplace Silk Road. If the government executes its plan, it could trigger a bearish trend for the bitcoin market, as was seen with Germany’s BTC sales earlier this year.

American stockbroker Peter Schiff suggested that MicroStrategy’s Michael Saylor step in to acquire the bitcoin stash to save the asset’s price from facing a severe bloodbath.