This article is based on research and analysis originally published by Matt Crosby. Bitcoin Magazine Pro.
Bitcoin has caused a wave in recent weeks, with Bitcoin prices surgeping beyond $95,000 a few months after months of performance. For many traders and investors, this shift marks the much-anticipated bull market revival. Question about everyone’s mind: Can Bitcoin ultimately beat the previous best of $108,000, or is this just another fleeting rally?
In this article, we will explore the factors driving Bitcoin’s recent momentum, diving into technical and chain data, discussing the broader macroeconomic context, and measure whether major cryptocurrencies can maintain this bullish drive.
Rapid rebound: recent surge in Bitcoin
Bitcoin prices previously experienced a significant drop of over 30%, falling from the all-time high of $100,000 to the $70,000 range. However, after a period of uncertainty, the cryptocurrency king regained its footing and returned to $90,000. This price recovery comes after a few months of integration phase that many consider to be a bear market structure. However, recent developments suggest that Bitcoin could be in the cusp of a massive breakout, supporting a new wave of Bitcoin price prediction models to take part in the debate.
Bitcoin Price Action has recently regained several important levels, including the Realised Price (STH Realised Price) for key short-term holders. Historically, short-term holders have achieved that prices serve as a level of support during bull markets. When this metric is reversed from resistance to support, it usually presents a robust foundation for even more upward movement.
Over the past few weeks, Bitcoin Price (BTC) has recovered levels of around $93,000 to $95,000, indicating that the market is preparing for a more substantial gathering. Given that the previous Bull Cycle saw similar behavior after regaining its major price levels, many are beginning to feel more and more bullish about the new all-time greatest potential in 2025.
On-Chain Data: Bullish Signs of Market Strength
When analyzing Bitcoin, it’s not just price action, but also chain data that matters. This data provides insight into the health of the network by understanding market participants’ behavior. The recent shift in long-term holder supply is one such indicator that points to Bitcoin’s enhanced outlook.
Over the past few months, Bitcoin has experienced an unusual pattern in which long term holders (people who have had Bitcoin for more than a year) could actively sell their holdings and lock in profits. This has led many to worry about Bitcoin prices approaching peak. However, recent data shows a reversal of this trend. Long-term holders have started to accumulate again. This is often a strong bullish signal in the Bitcoin market cycle. Historically, when long-term holders enter accumulation mode, they usually mark the beginning of a new bull phase.
Furthermore, the presence of ETF influx further strengthens this optimistic outlook. Over the past few weeks, Bitcoin ETFs have seen hundreds of millions of dollars flowing through them. This indicates an increase in institutional trust in Bitcoin. These influxes have been able to hold their position and even rallies despite a wider market correction, even in times of traditional markets like the S&P 500 facing volatility.
The role of the market fundamentals: Why do you feel this movement is different?
Currently, there is a fundamental change in the Bitcoin market. This suggests that this is not just a short rally. Bitcoin’s current upward momentum appears to be driven primarily by spot-driven purchases, rather than over-layer transactions. When Bitcoin prices rise due to increased spot demand rather than excessive leverage, this move is usually more sustainable and there is less trend towards sharp reversals.
One of the major factors behind this more organic upward pressure in Bitcoin prices is the decline in the US Dollar Strength Index (DXY). Over the past few weeks, DXY has been declining, indicating a decline in demand for the dollar. This trend has made risk-on assets like Bitcoin more attractive. As various monetary policy measures improve global liquidity, Bitcoin will benefit from this broad market trend. Reducing dollar strength indicates a potential change in investor sentiment, with more capital flowing into more assets and potentially superior in weaker dollar environments.
Furthermore, the correlation between Bitcoin and the traditional stock market, particularly the S&P 500, is an important factor to monitor. For most of 2023, Bitcoin has been a strong positive correlation with the stock market. This means that when the S&P 500s gather, Bitcoin tends to follow suit. Recent price action further suggests that Bitcoin’s bullish sentiment could be maintained, especially if traditional markets continue to rebound.
Macro factors: Global fluidity status
The broader economic context cannot be ignored. A large amount of liquidity was injected into global markets by the central bank from 2020 to 2022. This liquidity initially fueled asset inflation in all markets, but now shows signs of positive impact on Bitcoin.
Bitcoin has historically correlated with global liquidity trends, with recent data suggesting that increasing liquidity in the financial system is finally beginning to affect cryptocurrency markets. The recent surges in Bitcoin coincide with this increased liquidity, further strengthening the case of a longer-term bullish stage.
However, there are still important factors to consider. Global stock status and the potential to affect Bitcoin prices. The S&P 500 shows strong rebounds, but still faces resistance at key levels. Bitcoin prices are closely related to the broader performance of stocks, and Bitcoin outlook could also be curtailed if the stock market faces even more turbulence.
What’s next for Bitcoin: Over $100,000?
The $100,000 level is the immediate target for Bitcoin prices, but the real problem is: Can we break through this resistance and push it into the newest ever-highest territory? Recent recalls at key levels, such as the realised prices of short-term holders and the moving average (100 days, 200 days, 365 days), indicate that Bitcoin is in a strong position to once again test $100,000.
From a technical standpoint, Bitcoin is currently at the time of definition. If we can continue to build support beyond the $90,000 to $95,000 range, we will more and more likely to see a new all-time high. The next big resistance is probably around $108,000, the highest ever. If Bitcoin could break through that level, it would have been able to move rapidly towards a higher level, reaching an altitude of $130,000 in the next cycle.
However, there is always a possibility of retrace. If Bitcoin could not maintain its support level or if the global market conditions were bearish, the price could be reverted to the $80,000 range. Bearish retesting is a critical moment for the market as it could set the stage for more important negative aspects if support cannot be collected.
Conclusion: Bullish outlook with careful optimism
All signs indicate a potential Bitcoin rally with strong on-chain data, a favourable macro environment, and positive sentiment in the derivatives market. However, the key to maintaining this bullish momentum lies in Bitcoin’s ability to maintain current levels of support and navigate potential market modifications. The strong correlation with the S&P 500 remains an important element of viewing as stock recessions could affect Bitcoin price action.
In the coming weeks, all eyes will be the ability to reclaim Bitcoin’s $100,000 and set the best stage in new history. There is plenty of room for optimism, but traders need to be vigilant and ready for potential volatility. As always, the key to success in the crypto market is to remain data-driven and adapt to market conditions as they evolve.
To explore live data and provide information on the latest analytics, visit bitcoinmagazinepro.com.
Disclaimer: This article is for informational purposes only and should not be considered financial advice. Always do your own research before making an investment decision.
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