Bitcoin is showing no signs of being “overheated” despite reaching new all-time highs this week, according to analysts pointing to fundamentals that suggest more potential gains.
“The market does not look overheated from a fundamental perspective,” stated Alex Thorn, Galaxy’s Head of Research, in a Nov. 7 market report viewed by Cointelegraph. Nansen analyst Aurelie Barthere shared a similar view, noting, “Bitcoin crossing its all-time high with heavy volume is a clear signal of ongoing positive momentum following the elections,” as stated in her Nov. 7 report.
Barthere highlighted that after Donald Trump’s victory in the U.S. presidential election on Nov. 5, traders have been eager to “re-risk,” which has contributed to the recent surge in crypto prices.
In addition, Bitcoin’s Open Interest (OI) — the total number of unsettled Bitcoin derivative contracts — has “pushed slightly higher to new yearly highs,” Thorn pointed out. Despite this, funding rates have remained mostly unchanged. A stable or positive funding rate indicates trader optimism, as buyers are willing to pay a premium to hold long positions.
As Cointelegraph reported on Nov. 6, Bitcoin’s OI reached $45.4 billion, a 13.3% increase from Nov. 5. At publication, Bitcoin’s funding rate on Binance stands at 0.0100%, according to CoinGlass data.
Thorn believes Bitcoin and other cryptocurrencies will likely trade “at levels significantly above today’s all-time high over the next 12-18 months.”
Cointelegraph also reported that technical analysts anticipate Bitcoin rallying to the $78,000 to $85,000 range. Bitcoin is currently “consolidating” above its previous all-time high of $73,679 and “wants continuation,” as crypto trader Matthew Hyland noted in a Nov. 7 post.
Meanwhile, the U.S. Federal Reserve implemented a further 25-basis-point rate cut on Nov. 7, an anticipated move following earlier cuts in September. Lower rates are generally bullish for crypto assets, as traditional assets like bonds and term deposits become less attractive to investors.
