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- The price of bitcoin is up 7% over the past three days, briefly breaking through the $97,750 resistance on Thursday.
- Crypto stocks drew investor interest on Thursday, with Coinbase ( COIN ) and Microstrategy ( MSTR ) rising 3%.
- Daily active bitcoin addresses fell to a 50-day low of 676,000 wallets on Thursday.
The price of Bitcoin passed $97,750 on Thursday, up 7% since MicroStrategy’s most recent $200 million BTC purchase on Monday, December 29th. On-chain data shows that user activity on the Bitcoin network is still trending 30% below last month’s peak, signaling the potential for more gains ahead.
Bitcoin price surpasses $97k as MSTR and COIN performance hints at crypto market recovery
The price of bitcoin, along with other crypto-related assets, experienced intense downward volatility in the second half of December 2024.
The market jitters were fueled by the US central bank’s dovish stance, as the regulator hinted at fewer rate cuts in the first quarter of 2025 during the December 17 FOMC meeting.
The price of BTC quickly fell 15% in the ensuing two-week selloff, falling from a record high of $108,850 on December 17, only to hit the $91,500 mark on Monday.
Bitcoin Price Action (BTCUSDT) | Source: Binance
However, Bitcoin price trends turned positive on Monday after MicroStrategy extended its weekly BTC buying with another $209 million purchase.
Since the announcement on December 30, BTC price has recovered 6.8% and returned to the $97,800 level at the time of Thursday’s announcement.
Despite recent volatility that saw MicroStrategy’s MSTR stock price return more than 30% in the final weeks of December 2024, CEO Michael Saylor doubled down on his company’s audacious goal to acquire $42 billion worth of BTC in the next 3 years.
The move appears to have sparked positive sentiment among pre-market speculators.
While US stock markets remained closed for the Christmas holiday, crypto-related stocks including MSRT, Coinbase ( COIN ) and TerraWULF ( WULF ) posted more than 3% gains on Thursday, mirroring Bitcoin’s positive performance.
Microstrategy (MSTR) Stock Performance | January 2, 2025
When a sector makes such big gains in after-market trading, it triggers bullish signals for two key reasons.
First, after-market gains signal increased interest and optimism among investors.
Increasing anticipation often leads to a surge in buy orders when markets reopen as investors look to take advantage of the momentum.
Moreover, sustained post-market gains can break key technical levels such as resistance points or moving averages.
This could potentially trigger automated trades and stop-loss triggers to accelerate the bullish impact when markets open.
Bitcoin user activity is still 30% below last month’s peak
With capital flowing towards crypto-related stocks in US pre-market trading hours, current levels of user activity on the Bitcoin chain also signal the potential for even more upside.
Despite the 7% price increase seen over the past 3 days, retail trading activity has remained subdued, a move that could significantly impact BTC’s short-term price action
IntoTheBlock’s daily active addresses chart tracks the number of unique wallets executing valid transactions on a given day.
This serves as a proxy for tracking changes in mass market activity.
Bitcoin daily active addresses | Source: IntoTheBlock
The chart above shows just 676,000 addresses transacting on the Bitcoin blockchain on Wednesday, down 30% from the 976,490 addresses recorded at the market’s peak on December 16. Moreover, this represents the lowest Bitcoin user activity recorded in the 53 days since November 9th.
When prices rise during periods of declining user activity, as observed on the Bitcoin network this week, it signals that bullish momentum is driven by resilient long-term holders and short-term speculators.
With US retail markets opening on Friday, an influx of activity from retail traders covering the upside could potentially push prices further towards $100,000 in the coming sessions.
However, if the speculative whales decide to ditch early, BTC could be at risk of another reversal towards the $95,000 level.
The technical indicators on the BTCUSDT chart below offer insight into critical Bitcoin price support and resistance levels to watch as US markets reopen for 2025 on Friday.
BTC Price Forecast: Whales Eyeing First $100,000 Rise in 2025?
Bitcoin price is trading above the VWAP ($96,494), indicating strong bullish momentum.
Moreover, BTC Volume Delta is trending highest since December 15th indicating increased buying pressure.
Optimal appearance:
- Medium Bollinger band: Positioned at approximately $97,817, this acts as the first key resistance level.
- Upper Bollinger Band: Valued at $105,724, it represents the next target if the bullish momentum is sustained, potentially pushing BTC closer to the psychological milestone of $100,000.
Bitcoin Price Forecast | BTCUSDT
Bearish risks ahead
Such spikes in Volume Delta coinciding with drops in activity on the chain are often symptoms of intense speculative trading activity.
Considering the level of pre-market accumulation seen in MSRT, COIN and WULF this week, there is a potential risk of speculative whales dumping shares when the markets reopen.
If the whales exit their positions early, this could lead to a rapid price decline, triggering a bearish reversal.
Support Projections:
- Lower Bollinger Band: Positioned at $89,909, this is a critical support level in the event of a market selloff.
- VWAP support: The VWAP of $96,494 may act as an initial support zone during minor corrections.
Conclusion
The Bitcoin price forecast appears bullish in the short term, with technical indicators pointing to continued momentum towards $100,000. The price trading above VWAP and the Volume Delta jump reflect strong demand and investor confidence. However, amid the looming risk of high volatility, the $96,494 and $89,909 support levels are critical to watch for a potential downside.
