Bitcoin moved above $65,000 after tensions between the United States and Iran eased for a second straight day. The improving market mood also pushed most major cryptocurrencies higher, while oil prices dropped sharply.

Ethereum gained more than 4% over the past 24 hours, trading above $1,960. Other leading cryptocurrencies, including Solana (SOL) and XRP, also posted gains of around 1% to 2%. Meanwhile, global oil prices fell by nearly 5%, reflecting reduced concerns about supply disruptions.

Federal Reserve Decision Could Drive the Next Market Move

This week is expected to be an important one for both Bitcoin and the broader cryptocurrency market.

The U.S. Federal Reserve is scheduled to announce its July interest rate decision on Wednesday. Investors will be watching closely because the central bank's decision and comments about future monetary policy could have a significant impact on Bitcoin and other digital assets.

Market analysts believe Bitcoin's next major move will likely depend on the outcome of the Fed meeting and broader economic conditions.

Analyst Says Bitcoin Is Trading Below Its Historical Value

CryptoQuant analyst Axel Adler believes Bitcoin has entered a price range that has historically been considered undervalued.

According to Adler, Bitcoin's MVRV Z-Score, a popular on-chain metric used to measure whether BTC is overvalued or undervalued, has fallen to one of its lowest levels in recent years. However, it has not yet reached the negative zone that has often marked previous bear market bottoms.

The analyst noted that the current MVRV Z-Score is around 0.42, well below its long-term average of 1.7. While this suggests Bitcoin may be trading below its estimated fair value, it does not yet signal the extreme market fear and capitulation seen during previous market cycles.

Selling Pressure Is Falling, but Bull Market Is Not Confirmed

Adler also pointed out that Bitcoin's seven-day realized profit and loss indicator has recently turned positive after spending time in negative territory.

This change suggests that selling pressure on the blockchain is beginning to decrease. However, the analyst cautioned that lower selling pressure alone is not enough to confirm the start of a new bull market.

Instead, it may simply indicate that the market is entering a period of stabilization.

Strong Demand Is Still Needed for a Lasting Recovery

According to Adler, Bitcoin currently appears to be in an "undervalued stabilization phase" rather than at the beginning of a confirmed long-term uptrend.

For Bitcoin to establish a strong market bottom and begin a sustained rally, several conditions still need to be met, including:

  • Stronger on-chain demand from buyers.
  • Increased investor profitability.
  • Continued accumulation by long-term Bitcoin holders.
  • Higher market confidence supported by improving economic conditions.

Until these factors become more visible, analysts believe Bitcoin may continue to experience volatility despite recent price gains.

Final Thoughts

Bitcoin's recovery above $65,000 has improved market sentiment, especially as geopolitical tensions have eased. However, the upcoming Federal Reserve interest rate decision could become the next major catalyst for the crypto market.

While on-chain data suggests Bitcoin may be undervalued and selling pressure is declining, analysts say more buying activity and stronger investor demand will be needed before a new long-term bullish cycle can be confirmed.

Disclaimer: This article is for informational purposes only and should not be considered financial or investment advice.