Bitcoin (BTC) fell below the $94,000 mark as trading resumed on Dec. 23, signaling ongoing challenges for bulls seeking relief from traditional financial market pressures.
At the Wall Street opening, BTC/USD registered a 1.2% daily decline, according to data from Cointelegraph Markets Pro and TradingView.
Over the weekend, Bitcoin briefly surged to $99,500 but faced swift rejection by sellers. This downturn brought its losses from last week’s all-time high to a steep 15%. Market analysts are now closely monitoring Bitcoin’s short-term price action for signs of stability or further declines.
Bitcoindata21, a popular analytics account on X, highlighted the precarious nature of Bitcoin’s current support levels. “Underside retests and rejections of VWAPs are NOT what you want to see for bullish price action,” they noted, referring to volume-weighted average price points. The analyst suggested that Bitcoin could test the $92,000 level, with $85,000-$86,000 emerging as a potential zone for bullish re-entry.
Other traders, such as CrypNuevo, echoed similar sentiments. They predicted a revisit of lows near $90,000, emphasizing the psychological significance of this level. “It’s hard to imagine a V-shaped recovery from here,” CrypNuevo stated, proposing that a W-shaped recovery or a full retest of December’s earlier down-wick might be more likely.
Nonetheless, not all analysts were entirely pessimistic. Trader Jelle pointed out parallels between Bitcoin’s current behavior and its price movements at the end of 2023. “Too many similarities between this and last year to ignore this fractal,” Jelle remarked, while not ruling out a dip below $90,000 in the coming week. Jelle’s outlook remained optimistic for the longer term, suggesting that sustained upward momentum could resume in 2025.
The broader macroeconomic environment continues to cast a shadow over Bitcoin’s prospects. Following a hawkish update from the U.S. Federal Reserve, expectations for a near-term pivot in monetary policy have dimmed. The latest data from CME Group’s FedWatch Tool shows that the probability of an interest rate cut at the next Federal Open Market Committee (FOMC) meeting is a mere 8.6%.
“As inflation rebounds, the pivot is at risk,” noted The Kobeissi Letter, referencing central banks’ hesitancy to ease monetary policy further. Earlier in December, analysts warned of the adverse effects that shrinking global liquidity could have on Bitcoin and the broader cryptocurrency market.
As the holiday season approaches, Bitcoin’s price movements remain under scrutiny. While some traders anticipate a deeper correction, others see opportunities to accumulate at lower levels.
With macroeconomic uncertainties persisting and liquidity concerns mounting, Bitcoin’s path forward will likely hinge on a combination of technical resilience and external economic factors.
