Bitcoin’s mounting fundamental strength has been forming a compelling case that upside may be imminent for the cryptocurrency.

This underlying strength can be seen on multiple fronts, with the cryptocurrency’s market health growing due to spikes in the asset’s liquidity as well as its investor sentiment.

One on-chain indicator that examines the profitability of Bitcoin investors is now signaling that the benchmark digital asset may have significant room for growth in the near-term.

The last time BTC’s price hit $12,000, this indicator’s value was significantly lower than it is presently, which is a positive sign leading one research firm to note that its mid-term outlook remains bright.

Bitcoin’s recent price action has firmly favored bulls, although it has seen some weakness today due to the influx of selling pressure that briefly sent it below its key near-term support at $12,000.

Analysts are now widely noting that the crypto could be well-positioned to see further near-term upside due to its ability to hold above this level.

It is important to keep in mind that there is more than just technical strength bolstering the crypto’s short-term outlook.

According to a report from the analytics platform Glassnode, Bitcoin’s market health has been trending upwards in recent weeks.

Last week, they explained that an increase in liquidity and investor sentiment boosted the “Glassnode Network Index” score – signaling that BTC’s market health is growing in tandem with its price.

“Bitcoin on-chain fundamentals saw a slight increase during Week 33. GNI gained 2 points, bringing it back above 70. This was caused by increases in the Liquidity and Sentiment subindices.”

In addition to being backed by strong market health, the current profitability of investors also is favoring bulls.

While pointing to Bitcoin’s “Net Unrealized Profit/Loss” indicator, Glassnode said that the last time the crypto was above $12,000, this metric was sitting at a much higher level than it is currently.

This shows that the ongoing rally may prove to be far more sustainable than that seen last summer.

“Net Unrealized Profit/Loss (NUPL) broke in to the “Belief” zone for the first time over a year. Its current value is lower than the last time $BTC hit $12,000 – suggesting potential for more price upside from here.

The confluence of Bitcoin’s technical and fundamental strength is likely to help lift the cryptocurrency significantly higher in the days and weeks ahead.

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