As an analyst, I’ve noticed that Bitcoin (BTC) has been shrouded in uncertainty lately as it holds steady around the $100,000 mark. Unfortunately, today, the price of Bitcoin has dipped by [insert percentage decrease] and is currently trading at [insert current price]. This dip has also affected Ethereum (ETH) and Ripple (XRP), causing them to drop by [insert percentage decrease for ETH] and 2.4%, respectively.
A key factor contributing to Bitcoin’s recent decline may be linked to a robust job market, which has lowered the probability of interest rate reductions in 2025. In the latest FOMC meeting, the US Federal Reserve reduced their projected number of rate cuts in 2025 from five to two. Following the release of the Nonfarm Payroll (NFP) report, the market seems pessimistic about rate cuts. This cautious stance has caused Bitcoin to exhibit uncertainty and no clear trend over the past few weeks.
One cause of this crash is the overheated state of Bitcoin’s market dynamics. The surge in value from $67,000 to $100,000 over a 30-day period has resulted in numerous unaddressed discrepancies. Given these technical indicators, it appears that a correction may be imminent, possibly triggered by investor fatigue and the desire to realize profits.
The third factor behind the recent trend is a combination of investor reactions related to profit-taking and anticipation surrounding President-elect Donald Trump’s inauguration in January 2021. The significant surge that started in November 2024 was primarily fueled by speculation about Trump’s victory, which led traders to close their positions before the inauguration ceremony on January 20, 2021. However, this assumption of January 20 serving as a sell-the-news event did not hold up because Bitcoin and other cryptocurrency markets failed to maintain the bullish momentum from 2024.
Technically speaking, the significant support point where investors might look for a turnaround could be around $90,804. If this level doesn’t hold, there is potential for a drop to the levels of $89,355, $85,083, and even as low as $73,646.
Deribit’s Chief Line suggests a potential crash, as he notes that the options market indicates a 32% chance of Bitcoin reaching 100,000 by the month’s end. This prediction seems pessimistic to options traders, given the uncertainties surrounding Bitcoin and cryptocurrencies in general.
Experienced trader Peter Brandt shares a pessimistic viewpoint on Bitcoin, too, stating that the cryptocurrency is showing signs of a “typical Head and Shoulders top pattern.” He suggests that if this pattern plays out as expected, Bitcoin could potentially reach its target price. The estimated price for Bitcoin according to Brandt’s prediction is around $77,000.
He additionally included two additional scenarios that might play out, with the potential for the sequence to “break down like a bear trap” or “evolve into a broader pattern.
If Bitcoin rebounds from the $90,804 support point, it might aim for the buy-side liquidity located above the equivalent highs at $102,810. Beyond that, a significant level to watch is its current all-time high of $108,374.
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2025-01-13 15:24