From cointelegraph by Nancy Lubale

Bitcoin’s BTC$69,663 price rallied more than 10% between Oct. 26 and Oct. 29  to reach $73,600, just 0.2% below the $73,800 all-time high. Currently, Bitcoin price has retraced to $72,300, with several technical and onchain indicators raising concerns about the strength of the recent rally.

Let’s look at the factors that could potentially drive Bitcoin prices lower.

Over 99% of BTC supply in profit hints at overheating

Bitcoin’s recent rally within inches of its all-time highs saw almost all holders return to profit, resulting in fears that profit-taking from current levels could lead to deeper price correction. 

Data from market intelligence firm CryptoQuant reveals that less than 1% of Bitcoin investors were still in a position of loss when the price was at $72,323 on Oct. 31, subsequently accounting for 99% of the supply in profit. 

“99.7% of Bitcoin’s supply in profit,” noted analysts at crypto analytics firm Lab4crypo, adding:

 “We’re likely to see profit-taking increase and some selling pressure build-up.”

The percentage supply in profit and loss evaluates the sum of unspent transaction outputs (UTXO) that are in profit by comparing the price when they were last moved and the current price.

According to market analytics firm Into The Cryptoverse, applying a moving average (MA) can help identify “overheated” conditions when the MA begins to approach 100%.