Bitcoin (BTC) rebounded to above $90,000 after falling to $88,000 on Monday, supported by a strong dollar. This is due to the end of quantitative tightening policies and... market expectations of a 25 basis point rate cut after next week's Federal Open Market Committee meeting.$BTC
The Federal Reserve's dovish policy may make risk assets more attractive to investors. This will lead to more funds flowing into the cryptocurrency sector, especially in the crypto space. Whether these fund flows are sufficient to push stock prices to new highs remains to be seen.
Do on-chain indicators align with local market bottoms?
Source: Axel Adler
According to cryptocurrency analysts, Bitcoin bull market signals have been activated. Axel Adler specifically noted that as of the time of writing, the strength in the Bitcoin futures market reached 56.5, generating a bull signal.
This indicator considers the relative open interest, funding rates, and order side imbalance to generate a comprehensive measure of Bitcoin derivative pressure. A breakout above the 60 level will confirm a bullish signal and is expected to bring more upward momentum.
On the other hand, falling below 50 would indicate a bearish market shift and the risk of a pullback.
Source: CryptoQuant
The Coinbase Premium index turned positive on November 28 and has remained positive for most of the time since.
This indicates that the spot demand from American investors has increased, especially as this indicator measures the percentage difference between the BTC-USD and USDT trading pairs on Coinbase and Binance.
Source: CryptoQuant
The 'Coin Loss Day' indicator tracks the sentiment and behavior of long-term holders. This indicator is derived from the amount of UTXO destruction, and its peaks typically indicate that long-term holders are moving funds, which may also signify profit-taking.
In the past ten days, this indicator has been relatively calm. Traders can closely monitor this indicator to determine if a local top is forming.
A recent report from AMBCrypto pointed out that a quarter of the Bitcoin supply has flowed into the cryptocurrency market. The unrealized losses on this 25% of Bitcoin supply are currently underwater, mainly held by top buyers from recent months. The Bitcoin price needs to break through $106,200 for a structural change to occur.
Some final thoughts
As the Bitcoin price rebounded and broke through the $90,000 mark, the spot demand from American investors and bullish signals from the Bitcoin futures market followed.
Meanwhile, a large number of Bitcoin holders who purchased Bitcoin in recent months are in a state of loss.