Cryptocurrency

Bitcoin Analysts Predict Potential Recovery to $105K Despite Stagnant ETF Flows

Despite a lack of institutional buying power due to the holidays, Bitcoin analysts are predicting an imminent recovery above the $100,000 mark. The current price of Bitcoin has been trading under the psychological $100,000 mark since December 19 and is currently down 9.7% from its all-time high of above $108,300 recorded on December 17.

Table of Contents

Holiday Illiquidity Takes Center Stage

The holiday season has brought about a significant decrease in market activity, with liquidity levels plummeting. According to Ryan Lee, chief analyst at Bitget Research, the current downtrend is an organic symptom of the holiday illiquidity:

"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."

Positive Events on the Horizon

The analysts’ prediction comes nearly a month ahead of Donald Trump’s presidential inauguration on January 20, which is considered a positive event for cryptocurrency regulations in the United States and overall economic policy leading up to 2028.

Bitcoin Recovery Imminent, But ETFs Continue to Bleed

While Bitcoin is expected to recapture the six-figure price tag, its current price action remains limited by the slump in the US spot Bitcoin exchange-traded funds (ETFs). The Bitcoin ETFs are on a four-day losing streak, recording over $338 million worth of cumulative net outflows on December 24.

Funding Rate Signals Buyer-Dominated Market

Another bullish signal is seen in Bitcoin’s funding rate, or the payments that help keep trading fair by aligning futures and spot market prices. The positive funding rate signals a buyer-dominated market, as buyers pay sellers a fee (positive funding rate) to maintain their positions.

Technical Chart Patterns Suggest Correction May Extend

However, technical chart patterns suggest that Bitcoin’s correction may extend, wrote crypto analyst Rekt Capital in a December 24 X post:

"Bitcoin showed some signs of a relief rally after which price was rejected to almost new lows… Overall, as long as the previously lost supports turn into new resistance – additional downside should be expected."

Analysts Remain Optimistic About Bitcoin’s Trajectory

Despite the current correction, analysts remain optimistic about Bitcoin’s trajectory for the next year. Improved macroeconomic conditions could fuel Bitcoin’s rally to $160,000 in 2025, according to a report from crypto services provider Matrixport.

A Look Ahead: What to Expect in the Coming Year

As we look ahead to the new year, several factors will likely influence Bitcoin’s price action. The upcoming presidential inauguration of Donald Trump could bring about positive changes for cryptocurrency regulations and economic policy. Additionally, improved macroeconomic conditions may fuel a rally to $160,000 in 2025.

Conclusion

In conclusion, while the current correction may be a challenge for investors, analysts remain optimistic about Bitcoin’s trajectory for the next year. With a predicted recovery above the $100,000 mark and potential improvements in macroeconomic conditions, there are several reasons to believe that Bitcoin will continue to thrive in the coming year.

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