Bitcoin’s recent price drop from $99,000 has raised questions among investors and analysts about the cryptocurrency’s next move. As BTC hovers around $96,000, many are speculating whether the dip signals a larger sell-off or merely a temporary pause before a bullish recovery.
Critical Price Levels for Bitcoin
Crypto analysts are closely monitoring Bitcoin’s support at $96,000, a level that could determine its near-term trajectory. According to Ali Charts, a prominent trader, falling below this mark may lead to Bitcoin testing lower levels, with $90,000 and $85,000 as key targets.
“Based on Fibonacci retracement levels, if Bitcoin loses $96,000, the next focus becomes $90,000 and $85,000,” Ali explained in a recent market update.
Meanwhile, Bitcoin advocate Robert Kiyosaki maintains a positive outlook, encouraging new investors to consider the cryptocurrency for long-term gains. He emphasized Bitcoin’s potential to create wealth, advising against greed and urging caution when entering the market.
Long-Term Holders Adjust Strategies
Recent data from Glassnode reveals that long-term Bitcoin holders (LTHs) have reduced their holdings over the past two months. This trend coincided with Bitcoin’s rise from $58,000 to over $100,000, suggesting that some institutional investors are taking profits at current levels.
Despite this, the reduction in holdings by LTHs has been offset by increased activity from short-term holders (STHs), who are stepping in to absorb the selling pressure. Glassnode analysts highlight that the wealth owned by new investors has not yet reached the peaks observed in previous market cycles, indicating potential room for further price growth.
Positive Momentum Despite Correction
Although Bitcoin has faced a price correction, its overall market structure remains bullish. The AVIV Ratio, which measures unrealized profits, currently stands at 1.81—far below levels typically associated with market reversals.
Additionally, Bitcoin continues to form higher highs and higher lows, a key technical indicator of an ongoing uptrend. Analysts have set the next significant target at $113,000, aligning with the 100% Fibonacci extension level.
Institutional Demand Boosts Confidence
One of the driving forces behind Bitcoin’s resilience is the increasing demand from institutional investors. By mid-December, Bitcoin ETFs had accumulated $37 billion in assets under management, a sharp rise from $24.23 billion at the start of November.
This surge in institutional interest underscores Bitcoin’s growing appeal as a mainstream investment asset. Analysts at Bitfinex suggest that institutional participation will help stabilize Bitcoin’s price during corrections, predicting a potential rise to $145,000 by mid-2025. In a highly favorable market environment, they see the possibility of BTC reaching $200,000.
Bitcoin as a Strategic Reserve Asset
Another factor fueling optimism is the discussion around Bitcoin’s potential role as a national strategic reserve asset. If governments begin adopting Bitcoin in this capacity, its price could experience exponential growth. Experts speculate that such a move could drive Bitcoin’s value to $1 million, solidifying its status as a key player in the global financial system.
What Lies Ahead for Bitcoin?
Bitcoin’s ability to maintain support at $96,000 will be crucial in determining its next move. A sustained hold above this level could pave the way for a recovery toward $113,000, while a break below may lead to further declines to $90,000 or even $85,000.
Despite short-term fluctuations, the long-term outlook for Bitcoin remains promising. Strong institutional demand, coupled with its growing adoption as a strategic asset, suggests that Bitcoin’s bullish narrative is far from over. Investors and traders will be watching closely as Bitcoin navigates this critical phase, with both challenges and opportunities ahead.
