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Bitcoin price today: $102,000
- The price of bitcoin recovered slightly, trading around $102,000 on Thursday after falling 5.5% due to the Fed’s sharp rate cut decision the previous day.
- Whales, corporations and institutional investors have bought BTC’s recent dips.
- Traders should remain cautious as the Bitcoin NPL metric shows signs of profit taking.
Bitcoin (BTC) is recovering slightly, trading around $102,000 on Thursday after falling 5.5% the previous day. Whales, corporations and institutional investors saw an opportunity to take advantage of the recent declines and added more BTC to their holdings. However, traders should remain cautious as Bitcoin’s realized profit/loss (NPL) metric shows signs of profit-taking.
Bitcoin drops below $100K, whales, corporations and institutional investors continue to buy
The price of bitcoin is recovering slightly, trading around $102,000 on Thursday after falling 5.5% the previous day.
Bitcoin’s recent decline was fueled by the U.S. Federal Reserve’s (Fed) sharp decision to cut rates during Wednesday’s Federal Open Market Committee (FOMC) meeting. The Fed cut the federal funds rate to a lower range of 4.25% to 4.50%, as expected, but signaled a slowdown in rate cuts in 2025, sending risk assets like Bitcoin lower.
Bitcoin’s price correction on Wednesday triggered a wave of liquidations, resulting in more than $780.32 million in total liquidations and more than $143 million in BTC alone, according to CoinGlass data.
Liquidation diagram. Source: Coinglass
Moreover, during the meeting, Fed Chairman Jerome Powell said, “We are not allowed to own Bitcoin”.
“Fed policy indirectly affects the cryptocurrency market,” Ruslan Lekha, head of markets at Switzerland-based Web3 platform YouHodler, told FXStreet.
Lekha explained that cryptocurrencies have increasingly integrated into traditional finance due to the increasing correlation between crypto and traditional financial instruments.
“While the administration can directly influence the crypto market through policy decisions and regulatory actions, the Fed’s role is limited to managing monetary policy, which indirectly affects the crypto market through its impact on liquidity and investor sentiment in the financial ecosystem,” Lekha added.
Despite Bitcoin’s recent drop below the $100k mark, whales and corporations have added more holdings to their portfolios. Marathon Digital (MARA) added 1,627 BTC worth $166 million on Wednesday, according to data from Lookonchain. Additionally, three whale wallets bought 1,153 BTC worth $120 million after the price pullback.
Hut 8 Corp (HUT), an energy infrastructure company and Bitcoin miner, announced on Wednesday that it bought 990 BTC worth $100 million at an average price of $101,710 per Bitcoin. Combined with the Bitcoin before this purchase, Hut 8’s strategic Bitcoin reserve now totals 10,096 BTC with a market value of over $1 billion.
Institutional demand also remains strong. Bitcoin exchange-traded fund (ETF) data saw inflows of $272.30 million on Wednesday, continuing a streak of inflows since November 27, according to Coinglass. If the inflow trend continues or accelerates, it would act as a dampener on Bitcoin price declines.
Chart of Total Bitcoin Spot ETF Net Inflows. Source: Coinglass
However, traders should remain cautious as the Bitcoin network’s realized profit/loss (NPL) metric shows recent spikes that indicate signs of profit taking. If this trend continues or strengthens, Bitcoin may experience a correction in the coming days.
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Bitcoin NPL Chart. Source: Sentiment
Bitcoin Price Forecast: BTC recovers as it retests the $100k support level
Bitcoin price fell 5.5% on Wednesday, hitting a daily low of $100,000 and closing just above $100,200. On Thursday, BTC fell below the $100K level during the early Asian session, but is recovering and trading around $102,000 at the time of writing in the European session.
If BTC closes below the $100,000 psychological support level, it could extend the decline by 10% to retest the $90,000 support level.
The relative strength index (RSI) momentum indicator on the daily chart is hovering just above the neutral level of 50, indicating indecision among traders. However, the Moving Average Convergence Divergence (MACD) indicator showed a bearish transition on Wednesday, suggesting a downtrend.
BTC/USDT Daily Chart
If BTC continues its recovery and closes above the all-time high (ATH) of $108,353, it could extend its climb to a test of $119,510. This level is aligned with the 141.4% Fibonacci extension retraced from the November 4 low of $66,835 to the December 5 high of $104,088.
Frequently asked questions about bitcoins, altcoins, stablecoins
Bitcoin is the largest cryptocurrency by market capitalization, a virtual currency designed to serve as money. This form of payment cannot be controlled by any person, group or entity, which eliminates the need for third-party involvement during financial transactions.
An altcoin is any cryptocurrency except Bitcoin, but some also consider Ethereum a non-altcoin because of the forking of the two cryptocurrencies. If this is true, then Litecoin is the first altcoin, forked from the Bitcoin protocol and, therefore, its “improved” version.
Stablecoins are cryptocurrencies designed to have a stable price, with their value backed by the reserve of assets they represent. To achieve this, the value of any stablecoin is tied to a commodity or financial instrument, such as the US dollar (USD), whose supply is regulated by an algorithm or demand. The main goal of stablecoins is to enable investors willing to trade and invest in cryptocurrencies. Stablecoins also allow investors to store value as cryptocurrencies are generally subject to volatility.
Bitcoin dominance is the ratio of the market capitalization of Bitcoin to the total market capitalization of all cryptocurrencies combined. It provides a clear picture of Bitcoin interest among investors. BTC’s high dominance usually occurs before and during a bull run, in which investors resort to investing in a relatively stable, high market cap cryptocurrency like Bitcoin. A decline in BTC’s dominance usually means that investors move their capital and/or profits into altcoins in search of higher returns, which usually causes an explosion of altcoin growth.
