Bitcoin’s price has recently experienced significant volatility, influenced by various economic indicators and policy expectations. This decline followed a peak of nearly $103,000 earlier in the week.
The major decline was due to US labor market data that have reduced expectations of near-term Fed rate cuts. Lower interest rates are an advantage for risk-on assets such as Bitcoin because they increase the pool of investment capital while de-incentivizing bonds. However, this inflation trend worries investors about potential rate cut signals, which will likely be postponed further.
Still, its price stays above $90000 as prices demonstrate investment appetite and market consolidation. Concerns regarding the economic indicators and the supposed changes in the monetary policy still define the crypto’s standing as market actors weigh it.
Like Bitcoin, other tokens have also pulled back, with Ether and Solana down by 8% and more than 7% in 24 hours, respectively. The stock market fared no better, with MicroStrategy, Coinbase Global, and Marathon Holdings losing 10%, 8%, and 7% respectively. However, strong investments in Bitcoin and Ether ETFs proved that the investors were not losing faith.
Daily Candlestick Patterns Highlight Bitcoin’s Critical Turning Point
Renowned cryptocurrency analyst Crypto Rover recently compared today’s price action in BTC with past ones to support a bullish narrative for Bitcoin.
In a recent tweet, he said:
Bitcoin history is exactly repeating. January will turn green. You’ll regret not buying more here.
In a recent analysis, the expert who earlier predicted Bitcoin’s potential to create numerous new millionaires highlighted a bullish trend for the cryptocurrency. In a post dated December 30, 2024, the analyst shared a chart indicating Bitcoin’s price at $93,833 during a bearish phase. The post suggested a rapid upward movement, forecasting Bitcoin to touch $116,000 soon.
https://twitter.com/rovercrc/status/1873721449900593193
This prediction made only a week ago starts to make increasing sense if we let market trends dictate that we are heading into a bullish phase for Bitcoin. This analysis seems to reinforce growing optimism among investors about Bitcoin’s short-term performance. This echoes what other experts say will see strong growth for Bitcoin soon.
Analysts at Bitwise’s forecasts show that Bitcoin could touch $200,000 by the end of 2025 with the rise of institutional adoption and positivity in the market. Standard Chartered has also stepped up its game with a goal of $250,000 of Bitcoin by 2025 as its faith in Bitcoin’s long-term potential grows.
Titan of Crypto has shared some insight into the short-term movements of Bitcoin’s market. Yesterday’s candlestick saw the cryptocurrency close above the Kumo Cloud, but today’s trading is happening inside this important area.
https://twitter.com/Washigorira/status/1876952703844196569
According to analyst, the direction of Bitcoin is decided by its daily close. In that case, the price can break below the lower edge of the Kumo Cloud or even the critical Kijun level. The development is also a concern regarding a near-term bearish shift.
Bitcoin Bearish Concerns Resurface Amid Volatility
Crypto analyst Ali Martinez updated his analysis of Bitcoin’s recent price action. Martinez noted that on Jan. 7, Bitcoin broke above the right shoulder of a head-and-shoulders pattern, invalidating the bearish structure. As of Jan. 8, the sharp reversal wiped out those gains, sending Bitcoin back below the right shoulder and bringing the bears back into town.
Yesterday, #Bitcoin breached the right shoulder of a head-and-shoulders pattern, invalidating the bearish setup. However, today’s reversal erased those gains, dragging $BTC back below the right shoulder and reigniting bearish concerns.https://t.co/B6bPCfLNjy
— Ali (@ali_charts) January 8, 2025
Bitcoin has fallen below the demand area of $95,400 to $98,400, where a total of 1.77 million addresses collectively hold more than 1.53 million BTC. When prices fall into or below this area, holders can be compelled to sell their coins to reduce the potential for greater losses.
A further slip below the current level could spell doom for Bitcoin. Martinez warns that if selling pressure drops the price below $92,000, it could trigger a big drop. The next support level is near $74,000. With this news, macroeconomic concerns about deeper Bitcoin collapses heightened. However, from a technical viewpoint, TD Sequential has presented a buy signal on the 4-hour chart that may reveal some potential for a rebound shortly.
Source: XDespite the bearish caution, market sentiments are mixed. Binance traders still have a rather bullish santiment for Bitcoin. A $35 million liquidation zone at $98,600 could appeal to market makers looking to squeeze profits from unpredictable price swings. Martinez said Bitcoin must rise above $100,000 to break the bearish momentum. This may lead to new highs and restore investor confidence.
Bitcoin Exchange Transfers and Miner Outflows Drop
Since November, the amount of Bitcoin sent to the exchanges has significantly declined. These declines indicate less demand among exchanges due to lower selling pressure.
In the same way, Bitcoin miners have also reduced the amount of BTC sent to exchanges. According to CryptoQuant data, outflows peaked at about 25,367 BTC on November 11, when the price of Bitcoin reached about $88,000. By early January 2025, these outflows had dropped to around 5,489 BTC, hinting that a declining wave of miners are keeping their assets for a likely to appreciate future value.
The BlackRock spot Bitcoin exchange-traded fund (ETF) saw the largest single-day outflow of $332 m on January 4, 2025. This substantial withdrawal may have been due to profit-taking or a change in investors’ sentiments.
Recent data from those outflows also shows that BlackRock’s iShares Bitcoin Trust was the only U.S. Bitcoin ETF to have seen net inflows, indicating renewed investor interest and faith in Bitcoin’s long-term prospects.
Bitcoin Price Predictions for 2025
With 2024 ending, analysts and experts offer a wide range of predictions for Bitcoin price movements in 2025, from major surges to cautious movements. A dizzying array of contemporary underlying forces shapes their predictions.
Bullish Prediction
Over the years, several powerful analysts have predicted a bullish Bitcoin run in 2025. Tom Lee, a CNBC analyst, expects a peak in the cryptocurrency of $250,000, while Matthew Sigel of VanEck predicted it would hit $180,000. The optimistic projections are based on increased institutional adoption, the effect of Bitcoin exchange-traded funds (ETFs), and the historical cyclical patterns seen after each halving event.
Cathie Wood and Michael Saylor tout Bitcoin as overvalued at multimillion-dollar valuations over the next few years. However, their forecasts are long-term, and their confidence reflects the long-term potential many investors perceive for the digital asset.
Bearish Prediction
However, the bearish camp believes that potential macroeconomic and regulatory risks remain. Headwinds can include tightening monetary policies and regulatory crackdowns that would slow down Bitcoin’s growth. Among the economic trends, historical trends between Bitcoin price and M2 money supply may indicate that Bitcoin has the potential to depreciate in tighter monetary conditions.
Technical analysts cited by market analyst Peter L. Brandt suggest a dip to as low as $78,000. Brandt also cautions that these movements remain unpredictable, with the downward movement in these markets continuing or triggering a robust reversal.
While another ‘crypto winter’ is unlikely at this stage, unforeseen events like the 2022 FTX collapse remind us the market is a volatile place. However, analysts suggest that external crises, including financial or political, could temporarily affect the adoption of Bitcoin.
Neutral Prediction
Taking a more tempered view, some analysts predict 2025. Another big view is for a crater in January 2025, possibly down into the $80,000 to $85,000, due to macro events such as a U.S. presidential inauguration. In this scenario, we follow with subsequent recovery as Bitcoin sets new all-time highs later in the year and then go through typical market corrections.
Some investors are taking extra care around emerging technologies, like quantum computing. However, while advances in quantum computing could ultimately require modifications to Bitcoin’s protocol, analysts say the problem is not unique to this system but is intrinsic to modern encryption mechanisms as they stand for traditional finance. Consequently, in theory, there doesn’t seem to be much risk for Bitcoin’s long-term future.
Looking Ahead to 2025
The price of Bitcoin in 2025 will be influenced by many factors, starting with technological development and followed by the legal status in the country of use, as well as macroeconomic factors and investors’ sentiments. As experts debate the future of the world’s largest cryptocurrency, one thing is clear: Bitcoin’s progression will continue to dominate the economic dialogue.
Bitcoin (BTC) Technical Analysis
Over the past 24 hours, Bitcoin (BTC) has experienced a decline of approximately 3.16%, with its price decreasing from around $97,370 to $94,293.
The market has maintained a 24-hour trading volume of approximately $58.61 billion, reflecting sustained activity and investor interest.
MACD points out a day Simple Moving Average (SMA) of $96, 949 which is just above the current price, signaling bearish movement in the short term. However, the long-term SMA at $ 99,403 shows that the price is still below this average, supporting the perception of a bearish market.
The Relative Strength Index (RSI) is currently at 49.88, indicating it is within neutral territory. This can only mean that the market is fair and there is always room for either direction. Also, Bollinger Bands indicate that the price is approaching the lower band, implying high volatility and a given trend’s turning point or direction.
Support and resistance are key to understanding market trends. Contingent support is recognized at $93,000, including better support at about $90,000. On the flip side, there is clear, visible resistance at $99000. The $100000 psychological level is equally important to look at.
The market is relatively conservative, and traders wait for critical breaches of a $90,000 mark. A drop below this point could mean prices fall even lower, carving out new lows. On the other hand, an uplift may signal a return to bull territory.
