Analysts are monitoring Bitcoin's ability to recover and surpass the $100,000 threshold, despite a decline in institutional buying due to the holiday season.
The Bit price (BTC) has traded below the psychological $100,000 level since December 19 and is currently down 9.7% from the record high of over $108,300 recorded on December 17, according to data from TinTucBitcoin.
1-month BTC/USD chart. Source: TinTucBitcoin
However, Ryan Lee, head of research at Bitget Research, said the Bit price could quickly adjust above $105,000 as liquidity returns after the Christmas holiday.
The current downtrend of Bit is a natural manifestation of the lack of liquidity during the holiday season, he analyzed:
"After Christmas, market activity is usually expected to pick up again, with funds anticipated to actively position for sectors that may benefit from the upcoming Trump inauguration... The expected trading range for BTC this week is $94,000 - $105,000."
The analysts' forecasts come less than a month before Donald Trump's presidential inauguration on January 20, which is seen as a positive event for Cryptocurrency regulation in the US and overall economic policy leading up to 2028.
Bit recovery to 105K USD is imminent, but Bit ETF continues to bleed
Although Bit is expected to regain its six-figure price, its current price action is still constrained by the decline in US Bit ETF funds.
Bit ETF funds have been experiencing a four-day decline, recording a net outflow of over $338 million on December 24, according to data from Farside Investors showing.
Bit ETF flow (USD, million). Source: Farside Investors
ETF inflows have been a crucial driver for the Bit price surge in 2024. US spot ETFs account for around 75% of new investments into Bit, pushing its price above $50,000 on February 15.
Another bullish signal is seen in Bit's funding rate, which represents the payments that help facilitate fair trading by adjusting the perpetual and spot market prices, currently at 0.0100% on Binance, the world's largest exchange, according to data from CoinGlass showing.
Bit Funding Rate Historical chart. Source: CoinGlass
The positive funding rate indicates the market is buyer-dominated, with buyers paying a fee to sellers (positive funding rate) to maintain their positions.
However, technical chart patterns suggest the Bit correction may linger, as a prominent Cryptocurrency analyst, Rekt Capital, wrote in a post on X on December 24:
"Bit has shown some signs of a recovery bounce but has since been rejected near new lows... Overall, as long as previous supports turn into new resistance - further downside may occur"
1-week BTC/USD chart. Source: Rekt Capital
Nevertheless, analysts remain optimistic about Bit's direction in the coming year. Improving macroeconomic conditions could drive Bit's price to $160,000 by 2025, according to a report from Cryptocurrency service provider Matrixport.
