Nevertheless, as analysts remarked, Bitcoin is expected to recover above $105,000 in the next few days, bearing holiday-thrust illiquidity and relentless ETF drain. It has failed to recover to its key $100,000 psychological level and was down 9.7% from its all-time high of $108,300 seen on Dec 17, as per the Cointelegraph Markets pro index.
According to Ryan Lee, chief analyst at Bitget Research, December has general seasonal trends, which led to the current Bitcoin dip. “This downtrend is an organic symptom of holiday illiquidity,” Lee said, agreeing that, after Christmas, liquidity will bring XRP back above $105,000.
“Post-Christmas, market activity typically picks up again, with funds expected to actively position for sectors that might benefit from Trump’s upcoming inauguration… The expected trading range for BTC this week is $94,000 – $105,000.”
Trump Presidency Expected to Boost Bitcoin Regulatory Environment
The forecast also concurs with expectations of other positive effects of the Donald Trump presidency outcome on the regulatory and economic front when he is inaugurated as president on January 20. Experts expect the right policies within the crypto sphere and economic growth in the period leading to the year 2028 to aid the Bitcoin price.
Despite a positive outlook for Bitcoin’s recovery, all U.S. spot Bitcoin exchange-traded funds (ETFs) fell and posted net outflows of $338 million from Dec 24, 2021, data compiled by Farside Investors showed. ETFs have been instrumental in financing the Bitcoin boom in 2024, investing 75% of the new investments made into Bitcoin and taking prices past $ 50,000 in early February this year.
The trending of ETF flows has remained flat in the current period, attributed to holiday interruptions. Analysts opine that 2025 will see institutional investors return the Bitcoin market to its bullish status.
Increasing funding rates on Binance, the world’s largest exchange, are a bullish indicator for Bitcoin. As of the time of preparing this piece, the funding rate stands at 0.0100%, as depicted by CoinGlass. This portrays a buyers’ market where buyers offer sellers an opportunity to hold onto positions. This dynamic points to confidence among investors in the dynamic financial market.
Crypto analyst Rekt Capital said in a Dec 24 post that the current corrective period in the BTC/USD may continue to be prolonged before a recovery emerges. “However, in the short term, it is consolidating,” they pointed out, recommending their appointed degree of caution.
Of course, many near-term obstacles can be overcome. Bitcoin’s long-term outlook appears rosy. Crypto services provider Matrixport has revealed its view of Bitcoin reaching $160k in 2025, thanks to a better macro environment and institutional grab.
In this section, we analyze Bitcoin’s performance in the Christmas timeframe, pointing out factors such as low liquidity and ETF outflows. However, the cryptocurrency seems to have strong fundamental aspects for the market and might bounce back in early 2025. As institutional buying pressure grows and macroeconomic trends look up, Bitcoin will again have all the potential to continue its upward movement in the ensuing years.
This was very insightful! It gave me some fresh ideas.