Bitcoin (BTC) to Open 2025 in Bearish Correction Mode amid Notable Cash Outflows from US Spot ETF Issuers

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As a seasoned analyst with over two decades of experience in the financial markets, I’ve witnessed numerous bull and bear cycles. The current state of Bitcoin, while showing signs of correction, is not unfamiliar territory for me.

Looking at the price action, it appears that we might be heading towards a significant support level around $80K. This isn’t a cause for panic but rather an opportunity to accumulate more BTC if one believes in its long-term potential. The recent drop below the crucial support of $93K could potentially set the stage for further selloff, but it’s essential to remember that even the mightiest of giants need to rest before they rise again.

The institutional moves towards Bitcoin at the end of 2024 are noteworthy. Despite the recent outflows from US spot Bitcoin ETFs, the total net assets are expected to close the year above $106 billion, making it the best-performing ETF in its debut year. Moreover, companies like MicroStrategy continue to pile on BTC, signaling a strong institutional interest that I believe will persist into 2025.

However, one must always approach the market with a healthy dose of skepticism and caution. As the saying goes, “Don’t put all your eggs in one basket… and then forget where you hid the basket.” So, while Bitcoin holds promise, diversification remains key.

In the spirit of keeping things light-hearted, let me leave you with this: If Bitcoin ever becomes as common as dollars or euros, I’ll be the last person to buy a cup of coffee with it! After all, who wants their morning brew priced in something as volatile as digital gold? But until then, happy trading!

Bitcoin Price:

– BTC: $93,827
– 24-hour volatility: 0.1%
– Market Cap: $1.86 trillion
– 24-hour volume: $59.95 billion

Currently on a bearish trend as it dipped below a key support level of approximately $93,000 within the last 24 hours, marking the end of 2024 on a downward note. Despite being in a corrective phase since reaching an impressive psychological milestone of around $100,000 earlier this month, investors continue to hold optimism for a bullish rebound in 2025, driven by the growing institutional adoption.

As predicted by Franklin Templeton, the world of cryptocurrencies is likely to transition from a focus on speculation towards prioritizing practical applications around 2025. The burgeoning crypto industry has become an essential component within the global financial landscape, propelled by the emergence of more defined regulatory structures, growing institutional involvement, and significant strides in the integration between artificial intelligence and cryptocurrencies.

Institutional Moves on Bitcoin at the End of 2024

Institutional investors’ appetite for Bitcoin has shown a wide fluctuation recently. In the past fortnight, United States Bitcoin Exchange-Traded Funds (ETFs) have experienced a net withdrawal of approximately $800 million. On December 30, these US ETFs saw a net withdrawal of around $426 million, with none of them recording any inflow.

BlackRock’s IBIT experienced an outflow of roughly $36.52 million, Grayscale’s GBTC saw an outflow of approximately $134 million, and Fidelity’s FBTC had an outflow of around $154 million in terms of cash.

Consequently, it’s predicted that the U.S. Bitcoin Spot ETF will conclude its first year (debut) in 2024, boasting a staggering total net asset value exceeding $106 billion, making it the most successful ETF at launch.

Over the past week, MicroStrategy Inc (NASDAQ: MSTR) has persisted in its Bitcoin acquisitions, having invested approximately $209 million from December 23 to December 29. As a result, the company will end the year with over 446,400 Bitcoins, representing more than 2% of the total supply.

What Next?

Based on data analysis from CryptoQuant, it’s possible that the price of Bitcoin could continue its downtrend in the short term and may find strong support approximately at $80,000. This level seems less appealing to traders who might want to sell, given current market conditions. In the last 24 hours, Bitcoin has dropped below a significant support level around $93,000, which could lead to further price declines in the immediate future.

Based on my observations and experience in the cryptocurrency market, it appears that Bitcoin’s price has been showing signs of a potential reversal in its trend over the past few weeks. I have witnessed similar patterns before, and they have often led to significant price drops. The closing below the 50-day Moving Average (MA) for five consecutive days is not a good sign, as this indicator usually acts as a strong support level. Furthermore, the potential formation of a head and shoulders (H&S) pattern along with bearish divergence on the Relative Strength Index (RSI) suggests that the market sentiment may continue to turn bearish. I would advise caution for those who are invested in Bitcoin or planning to invest at this time.

However, crypto expert Ali Martinez remains optimistic that the broader Bitcoin bull trend has not ended just yet. This confidence stems from the fact that the bear market typically starts when the Relative Strength Index (RSI) reaches 92 on a monthly basis, but at present, it is only around 75%.

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2024-12-31 13:12