Cathie Wood's Ark Invest Says 'Uptrend' Developing In Bitcoin's Market Structure Because Of This Reason

Asset management giant Ark Invest predicted a positive turn for Bitcoin’s BTC/USD price on account of the oversold conditions witnessed for the Stablecoin Supply Ratio Oscillator (SSRO.)

What Happened: A recent report. from the Cathie Wood-led firm revealed that the SSRO, a metric used to measure Bitcoin’s potential purchasing power, hit an oversold point of -2.27 in early September, a level not seen since the bear market lows of 2022.

For the curious, the SSRO is determined by dividing the Bitcoin supply by the supply of all major stablecoins, denominated in BTC. The ratio’s 200-day moving average, plus 2 standard deviations above and below, is then plotted. The SSRO tracks how the ratio fluctuates between these two standard deviation bands, also known as Bollinger bands.

ARK Invest posits that these oversold conditions could signal a positive turn for Bitcoin’s price. This hopeful outlook was supported by the formation of two higher local lows seen at $52,530 in early September and at $58,863 on Oct. 10, suggesting that an uptrend may be forming in the asset’s market structure

See Also: Coin That Underpins Dogecoin Becomes Market’s Biggest Gainer— Litecoin Pops 7% After Filing Of Spot ETF Application

Why It Matters: The latest prediction comes amid Bitcoin’s strengthening rally, which has seen the leading cryptocurrency grow by 7% this week.

Notably, CEO Wood has previously expressed bullish sentiments about Bitcoin, predicting a potential surge to a per-unit price of $3.8 million by 2030. Although not impossible, it is very unlikely for BTC to achieve these numbers any time soon.

According to Wood, Bitcoin would hit such a valuation if institutional investors allocated more than 5% of their portfolios into it, a highly unlikely phenomenon.

Apart from Bitcoin, ARK Invest was also betting big on Ethereum ETH/USD. The firm viewed Ethereum as an “institutional-grade asset” with yield-bearing potential, predicting it to play a critical role in the financial services industry.

Price Action: At the time of writing, Bitcoin was exchanging hands at $67,194.97, up 2.17% in the last 24 hours, according to data from Benzinga Pro.

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Disclaimer: This content was partially produced with the help of Benzinga Neuro and was reviewed and published by Benzinga editors.

Photo courtesy: Ark Invest