Copper analysts predict a short-term jump in the BTC exchange rate

What’s new? According to Copper’s custodial analysts, the current bitcoin rate fluctuations above $66 000 indicate a potential short-term peak, while on-chain indicators suggest the market is overheating.

Material by The Block

What else is known? According to Copper’s report, 98% of wallet addresses are now profitable based on the price at which the asset was last transferred. Historically, the sharp rise in the share of profitable wallets has led to selling pressure as investors sought to lock in profits.

According to analysts, this could signal that the market is experiencing a temporary rebound ahead of the US election.

As for bitcoin-based spot exchange-traded funds (ETFs), overall enthusiasm for these products remains muted despite significant inflows.

Since the launch of bitcoin ETFs in January 2024, total inflows into them have exceeded $21 billion. However, after seven days of inflows (October 11-21), the total for the 11 funds changed to negative on Tuesday, October 22.

“Certainly, markets have reacted to the recent seven days of inflows, and prices broke past the $69 000 mark for the first time since July. Yet, something seems amiss in terms of growth. At the start of the year, there was a large cluster of daily growth in ETFs, which has been absent from the markets lately,” the report says.

At the same time, analysts at ETC Group noted the strongest increase in bitcoin demand since April. The main factor is also called the upcoming US presidential election, the chances of Trump’s victory have significantly increased, which has a positive impact on the crypto sector.

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However, ETC Group also noted another factor in the growing demand for bitcoin: the growth of risk appetite in financial markets in general. For example, last week, the US stock market and gold prices reached new record highs, signaling that investors are increasingly willing to take risks.

In addition, concerns about the growing US budget deficit may encourage investors to use bitcoin as a safe haven asset. US government debt has risen by nearly $500 billion since the beginning of September.

“We believe the combination of bitcoin’s limited supply, shifting global monetary policies, and positive fourth-quarter seasonality will provide strong support for crypto assets in the coming months,” the ETC Group analysts said.