As Bitcoin (BTC) experiences a period of lateral movement, investors are left to speculate on whether the leading cryptocurrency will close the year with gains or losses. Analysts are divided, with some suggesting that a return to previous highs could push BTC to new heights.
Understanding Bitcoin’s Recent Trends
Bitcoin’s Fluctuating Journey: A Red Week but a Green Year
After surpassing the much-anticipated $100,000 mark in early December, Bitcoin has undergone two major corrections within its one-month trading range. Throughout December, the cryptocurrency’s value oscillated between $90,000 and $108,000, maintaining a steady range between $96,000 and $102,000 for the majority of the month.
Recently, Bitcoin reached a new all-time high (ATH) of $108,353 but has since fallen below the critical $100,000 support zone, reaching its lowest price in weeks. Over the past week, BTC has struggled to regain the $98,000 support level, failing to maintain its Christmas rebound above this threshold.
Currently, the largest cryptocurrency by market capitalization is trading within the mid-range of its monthly spectrum. According to Altcoin Sherpa, the candlestick patterns appear neutral, suggesting a potential for unpredictable price movements. There is speculation of unusual price fluctuations in the coming weeks, potentially leading to a significant surge and an altcoin season.
Moreover, Daan Crypto Trades describes BTC’s current trend as the “end of the year chop.” As Bitcoin continues its sideways movement, liquidity is accumulating on both sides, with crucial levels identified below $94,000 and above $100,000. Despite this horizontal trajectory, some investors emphasize the importance of looking at the bigger picture, as BTC remains within a historical range. If Bitcoin concludes the year at its current price, it will still achieve a 48.15% return in Q4 and a 122% increase over the year.
Potential Risks: Could Bitcoin Fall to One-Month Lows?
Analyst Carl Runefelt highlights the $92,500 support zone as a critical level for investors to monitor. A breach below this level could lead BTC’s price to drop to $86,000. Similarly, Ali Martinez warns of a crucial level for Bitcoin, noting that a dip below $92,730 could lead to a significant decline, potentially reaching as low as $70,000, according to the UTXO Realized Price Distribution (URPD) chart.
In a previous analysis, Martinez explored a bearish scenario where BTC might fall to $60,000, with projections of a correction ranging from 23% to 36%. He considers a 25% crash to $70,000 plausible, given the minimal support below the $93,806 and $92,730 zones. If this critical demand area doesn’t hold, a sharp drop to $70,085 could occur.
Martinez also indicated that Bitcoin has fallen below a major support zone at $97,300, suggesting a bearish outlook unless reclaimed. However, this negative outlook could be invalidated if BTC manages to sustain a close above $97,300 and, more critically, achieve a daily close above $100,000. Reclaiming these levels could initiate the next surge toward the $168,000 target.
As of this writing, Bitcoin is trading at $94,587, reflecting a 1.24% decrease in the daily timeframe.
