Bitcoin Price Crash: Will BTC Sell Off Continue Ahead?

Kelvin Munene Murithi
December 20, 2024
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CoinGape has covered the cryptocurrency industry since 2017, aiming to provide informative insights to our readers. Our journal analysts bring years of experience in market analysis and blockchain technology to ensure factual accuracy and balanced reporting. By following our Editorial Policy, our writers verify every source, fact-check each story, rely on reputable sources, and attribute quotes and media correctly. We also follow a rigorous Review Methodology when evaluating exchanges and tools. From emerging blockchain projects and coin launches to industry events and technical developments, we cover all facets of the digital asset space with unwavering commitment to timely, relevant information.
Bitcoin Price Is Up 0.56% Today as US Treasury Secretary Says BTC's Becoming Store of Value

Highlights

  • Bitcoin retests $99K as holders eyes key levels at $90K and $85K if $96K breached.
  • LTHs selling off; Bitcoin ETFs assets surge to $37B in Dec, up from $24.23B.
  • Bitcoin's potential as a national strategic reserve could boost price to $1M.

Bitcoin’s recent price correction has sparked debates among analysts and investors about its potential trajectory. After briefly retesting $99,000, Bitcoin’s price momentum has slowed, raising questions about whether this signals the start of a larger sell-off or a temporary pause in its uptrend.

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Analysts Highlight BTC Price Key Levels

Crypto trader Ali Charts has put a lot of emphasis on the $96,000 level. He explained that if Bitcoin price moves below this level, the following significant points will be $90,000 and $85,000. This view is consistent with the historical Fibonacci levels of retrace commonly employed by traders to understand market reversals.

“Keeping it simple, based on the Fib, if Bitcoin loses $96,000, the next focus becomes $90,000 and $85,000,” Ali tweeted.

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To this, Robert Kiyosaki, a supporter of Bitcoin, said that it is never too late to join the market. He pointed to Bitcoin’s stability and capability to generate riches, saying, “Bitcoin is designed to make everyone rich, including those who come in late. Just don’t get greedy.”

Long-Term Holders Take Profits as Short-Term Investors Step In

Using data from Glassnode, some changes have been observed in the activity of long-term Bitcoin holders (LTHs). In the two months period, the total supply held by LTHs has been decreasing from $14.23 billion to $13.31 billion.

This comes as BTC price soared from $58,000 to over $100,000 suggesting that institutional investors are booking profits at local highs.

However, these sales by the long-term holders have been taken by the short-term holders (STHs) to ensure that the prices are maintained. Glassnode analysts pointed out that “the share of wealth owned by new investors has not yet reached the levels that were seen during the previous cycle peaks” which may mean that there is still some room for growth.

Bitcoin’s Bullish Momentum Remains Intact

However, based on the correction, some analysts continue to hold the view that the price of Bitcoin is still bullish. The AVIV Ratio, which looks at unrealized profits, is at 1.81, far from the levels that are considered extremely high and which usually signify a reversal in market trends.

This means that although some traders may have taken their profits, the market has not become overly aggressive.

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Meanwhile, the Titan of Crypto still has the positive outlook about Bitcoin’s future. He stressed that Bitcoin has been making higher highs and higher lows which is a positive indication that the trend remains bullish. ”BTC bullish momentum remains strong, with the next target at the 100% Fibonacci extension of $113,000,” he stated.

Institutional Demand Could Propel Bitcoin Further

The adoption of Bitcoin has remained strong, with Bitcoin ETFs hitting a top of $37 billion in assets by December 19th. This represents a sharp rise from the $24.23 billion at the beginning of November as highlighted by Farside Investors.

At the same time, statistics show that at the peak of Bitcoin at $108,000, 62.17% of traders had short positions, expecting the price to fall. However, as Bitcoin dropped to $96,000, the sentiment changed as 55.44% of the traders are now bullish because they anticipate a rally in the price of the cryptocurrency.

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Supporting this price trend, analysts at Bitfinex believe that the price correction of Bitcoin will be relatively mild owing to the rising demand from institutional investors. They expect it to be at $145,000 by mid-2025, with a possibility of rising to $200,000 in a better environment.

Furthermore, in light of the growing talk about the potential of Bitcoin as a strategic reserve asset at the national level, experts estimate that such a decision could take Bitcoin’s price to $1 million.

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Investment disclaimer: The content reflects the author’s personal views and current market conditions. Please conduct your own research before investing in cryptocurrencies, as neither the author nor the publication is responsible for any financial losses.
Ad Disclosure: This site may feature sponsored content and affiliate links. All advertisements are clearly labeled, and ad partners have no influence over our editorial content.

Why Trust CoinGape

CoinGape has covered the cryptocurrency industry since 2017, aiming to provide informative insights Read more…to our readers. Our journal analysts bring years of experience in market analysis and blockchain technology to ensure factual accuracy and balanced reporting. By following our Editorial Policy, our writers verify every source, fact-check each story, rely on reputable sources, and attribute quotes and media correctly. We also follow a rigorous Review Methodology when evaluating exchanges and tools. From emerging blockchain projects and coin launches to industry events and technical developments, we cover all facets of the digital asset space with unwavering commitment to timely, relevant information.

About Author
About Author
Kelvin Munene is a crypto and finance journalist with over 5 years of experience, offering in-depth market analysis and expert commentary . With a Bachelor's degree in Journalism and Actuarial Science from Mount Kenya University, Kelvin is known for his meticulous research and strong writing skills, particularly in cryptocurrency, blockchain, and financial markets. His work has been featured across top industry publications such as Coingape, Cryptobasic, MetaNews, Cryptotimes, Coinedition, TheCoinrepublic, Cryptotale, and Analytics Insight among others, where he consistently provides timely updates and insightful content. Kelvin’s focus lies in uncovering emerging trends in the crypto space, delivering factual and data-driven analyses that help readers make informed decisions. His expertise extends across market cycles, technological innovations, and regulatory shifts that shape the crypto landscape. Beyond his professional achievements, Kelvin has a passion for chess, traveling, and exploring new adventures.
Investment disclaimer: The content reflects the author’s personal views and current market conditions. Please conduct your own research before investing in cryptocurrencies, as neither the author nor the publication is responsible for any financial losses.
Ad Disclosure: This site may feature sponsored content and affiliate links. All advertisements are clearly labeled, and ad partners have no influence over our editorial content.