Bitcoin (BTC) has recently experienced a decline, trading at $104,679 after reaching an all-time high of over $108,000 on December 17. This suggests that there is still bearish sentiment in the market, with sellers taking advantage of price rallies.
Arthur Hayes, co-founder of BitMEX, has expressed concerns about the future of the crypto market, predicting a potential downturn after the inauguration of President-elect Donald Trump in January 2025. He believes that any significant policy changes regarding cryptocurrency will take time to implement, which could lead to a market correction.
On the other hand, analysts from Bitfinex have a more optimistic outlook. They believe that any dips in Bitcoin's price will be short-lived due to strong institutional demand. They project that Bitcoin could reach $145,000 by mid-2025 and potentially even soar to $200,000 under favorable market conditions. This positive sentiment is supported by the increase in net assets within U.S. Bitcoin exchange-traded funds (ETFs), which now exceed the assets held in U.S. gold ETFs.
In terms of technical analysis, the recent price action for Bitcoin indicates a struggle to maintain momentum after breaking above the resistance line of an ascending channel pattern. While the rising moving averages suggest a bullish advantage, a negative divergence on the relative strength index (RSI) suggests a potential loss of upward momentum. Traders are advised to monitor the 20-day exponential moving average (EMA) at $99,974, as a rebound from this level could signal a renewed attempt to breach resistance levels and push the BTC/USDT pair to $113,331 and later to $125,000. However, a drop below this support could lead to a decline towards the 50-day simple moving average (SMA) at $90,839.
Ethereum (ETH) is also facing challenges, currently priced at $3,880.67. The cryptocurrency has encountered resistance at $4,094, with bears actively defending this level. A strong rebound from the 20-day EMA at $3,775 could enhance the likelihood of a rally above $4,094 and potentially drive the ETH/USDT pair towards $4,500. However, a close below the 20-day EMA would indicate weakening bullish momentum and could lead to a decline towards the downtrend line.
XRP (XRP) has shown resilience, with its price at $2.47 after a relief rally that briefly surpassed the near-term resistance of $2.65 on December 17. If buyers can maintain their position, there is potential for XRP to challenge the crucial overhead resistance at $2.91, with a breakout above this level paving the way for a rally towards $3.50. However, bears are poised to regain control if the price falls below the 20-day EMA at $2.25, which could trigger a decline to the 61.8% Fibonacci retracement level at $1.90.
Solana (SOL) is currently trading at $216.15. Although it dipped below the 50-day SMA of $218 on December 16, it defended the $210 support level on December 17. However, the inability to maintain prices above the 20-day EMA at $225 raises concerns. If the price rebounds from $210 and breaks above the channel's resistance line, it could signal a shift in momentum. On the other hand, a breakdown below the $210 support level may lead to a decline towards the support line of the descending channel pattern.
As the cryptocurrency market continues to evolve, it is important for investors to remember that every trading decision carries inherent risks. Thorough research and analysis are crucial for navigating this volatile landscape.