Bitcoin (BTC) is the leading cryptocurrency in the world, thus, from big investors to traders everyone remains keen to buy this digital asset and its price chart also remains in the focus. Lately, BTC showed remarkable highs and noticeable volatility throwing investors into a frenzy to wonder if it’s the right time to buy BTC or not. Amidst huge volatility in the prices of BTC, some key factors that influence the market have come into play.
Key Takeaways
- Bitcoin reached a new all-time high price of $108,300 on December 17, 2024.
- Due to market uncertainties, BTC faced a pullback of 13 percent.
- For the first time in eight weeks, Bitcoin dropped to $90,000 on January 13, amidst mounting selling pressure.
- The crucial resistance zone suggested by analysts for BTC is between $97,330 and $99,680.
Bitcoins remained one of the media’s front-page headlines in December 2024 when this token touched an all-time high of $108,300. After this potential bullish breakout, the cryptocurrency has only experienced a pullback as it retreated by 13 percent. The profit-taking and general market uncertainties ahead of President Donald Trump’s Inauguration Ceremony led to this pullback. Yes, you read that right, President Donald Trump’s Inauguration Ceremony as the 47th President of the United States on January 20, 2025, also influenced the market. Despite the price of Bitcoin has retreated by 13 percent it is still much higher than at the start of the year, sparking market speculations which means that traders are on high alert for any additional price movements.
The daily chart of Bitcoin hinted at the possible formation of a head-and-shoulders pattern, which is an indication of higher volatility to arrive in the market soon. The head-and-shoulders pattern is considered a bearish reversal pattern as it predicts that big price fluctuations to happen soon. Thus, a big price movement the Bitcoin is also anticipated. In addition, Doji candles also have formed in the market in the last few days, which means there’s a bright chance of market volatility. Patterns like Doji candles and head-and-shoulders are always important because they alert traders about the movement in the price of cryptocurrencies. Thus, these technical factors are always crucial for traders.
On Monday, January 13, 2025, BTC even slipped below the $90,000 mark for the first time in eight weeks amidst mounting selling pressure. However, it was able to recover swiftly as it rebounded to $95,000. Following the price fluctuation of BTC from $108,300 to $90,000, analysts suggested a critical resistance zone of $97,330 to $99,680. In this resistance zone, around 1.26 million addresses stored 1.22 million BTC. Thus, it is an important area where future price action is dependent. If BTC breaks out above this resistance zone, the traders can make huge gains, otherwise, failure to break through this resistance zone could indicate further fall.
Other macroeconomic factors also play a significant role in the trajectory of the Bitcoin price. The monetary policy of the Federal Reserve has been one of the most crucial factors for the investors of Bitcoin. Ahead of Trump’s inauguration ceremony, many speculated that the government might raise its policies in 2025, raising Treasury yields with a strong US Dollar will have negative effects on the prices of BTC. For the unversed, the first Federal Reserve interest rate decision of 2025 is scheduled for January 29, 2025. Traders and investors can expect further market volatility from January 29 onwards which will directly influence Bitcoin as well as other cryptocurrencies. Despite short-term volatility, major asset managers have predicted a spike in the price of BTC from $180,000 to $200,000 by the end of this year.
In Case You Didn’t Know
- This year is anticipated to witness the peak of the Bitcoin Bull Market as per the Bitcoin Four-Year Cycle theory.
- The next year is predicted to be a Bear Market for Bitcoin as per BTC’s 4-year cycle theory.