BTC falls on profit-taking concerns

The analyst noted that Bitcoin (BTC) has turned an old support level into resistance, indicating a possible extended correction.
Current sentiment is reported to be driven by earnings and macroeconomic factors.

Bitcoin (BTC)’s struggle to return to its all-time high price continues as it has fallen 2.8% in the last 30 days. Meanwhile, the asset slowly climbs up the price curve as it records a 2.6% jump on its daily chart to $95.4K at press time.

According to our market data, this sluggishness applies to almost all 20 leading large-cap cryptocurrencies as Ethereum (ETH) also fell by 7.98% in the last 30 days trade at 3.4 thousand USD. Within the same time frame, Solana (SOL) fell by 18%, Dogecoin (DOGE) fell by 24%, and Cardano (ADA) is down 18%.

Looking at crypto-related stocks, we noticed a similar trend as MicroStrategy’s MSTR dropped by 7% while Coinbase’s COIN declined by 5.3 percent. Well-known Bitcoin mining companies MARA Holdings (MARA) and Riot Platforms (RIOT) also fell for 7%.

According to analysts, the recent pullback was triggered by a high level of profit-taking after an unprecedented move to reach an all-time high of $108,000. According to the data, profit realization exceeded 1.2 billion dollars in the last seven days. Comparatively, profit taking was about $4 billion on December 11. Meanwhile, this activity is mostly driven by investors who have held Bitcoin for many years.

Other Bearish Factors Affecting Bitcoin Price

Looking at other bearish factors, we noted that the lowest reading in the US Chicago PMI contributed to the current market condition. It is important to note that the PMI measures the performance of the manufacturing and non-manufacturing sectors in Chicago. The reading is said to be the lowest since May.

Another factor contributing to this decline is the uncertainty surrounding the Federal Reserve’s interest rate policy. It was previously reported that the US central bank will pause interest rate cuts until at least March.

Commenting on this, partner at Amundsen Davis, Joe Carlasare, noted that the market has already exceeded expectations in 2024. According to him, the market could see a recovery in 2025.

Looking ahead to 2025, I am optimistic but expect the path to diverge from consensus, as markets often do. Bitcoin adoption continues to grow and I predict it will generally move in line with traditional markets. If the US avoids a significant slowdown in growth, bitcoin should perform well, although the ride could be tougher than in 2024.

Meanwhile, Rekt Capital’s analyst believes the market is moving into an extended correction phase. According to him, Bitcoin has fallen below the old support level, turning it into resistance.

Weekly support is lost. The 5-week technical uptrend has ended. Bitcoin is showing increasing signs of moving into a multi-week correction. Any recovery, if any at all, in these old supports could turn them into new resistance to confirm further downside continuation.