Under the influence of the 'Christmas rally', Bitcoin (BTC) experienced a short-term rebound, with prices rising 4% at one point. However, despite the festive atmosphere, the market remains filled with psychological risks, and a bull market rebound still seems out of reach. Since Bitcoin broke through $108,000 ten days ago to set a new high, market sentiment has undergone significant fluctuations. While there are currently no signs of an overheated market and the greed index is far from the warning line of 90, cautious sentiment among investors still prevails.
The impact of profit-taking
Just as Bitcoin prices hit a high of $108,000, many investors chose to cash out around $94,000, realizing a profit of $7.17 billion. Although this pullback may seem frustrating, from the perspective of market behavior, the exit of weak investors is often seen as a healthy correction, providing opportunities for new capital to enter and promoting long-term market stability.
However, as Bitcoin prices rebound to $100,000, investors remain in a state of tension. The current market pullback seems to be temporarily dissipating in the short term, but whether the true rebound of the market has arrived remains an open question.
Subtle shifts in capital flow
Contrary to previous increases, Bitcoin's exchange reserves recently surged to 2.427 million BTC, reaching the highest level since November. This indicates that a large number of short-term holders are locking in profits, especially those who have held their coins for less than five months. Additionally, the inflow of BTC to exchanges also hit a five-month high, with deposits reaching 21,000 BTC at an average price of around $98,000.
These dynamics led BTC prices to drop to $92,000, marking the lowest point in over two weeks. This price range is clearly a strong profit-taking area, and the festive atmosphere helped Bitcoin quickly rebound by 4%, returning to the $98,000 to $100,000 range. However, even so, institutional demand through Bitcoin ETFs remains sluggish, with outflows continuing for four days, indicating that the current price has failed to attract sufficient institutional capital.
Psychological resistance and the inflow of new capital
Although retail buying has slightly rebounded, this recovery is still insufficient to be called a full 'accumulation'. As the New Year approaches, BTC prices may fluctuate between $100,000 and $105,000. However, breaking the historical high (ATH) will still take time, and the psychological resistance in the current market environment has clearly become the biggest obstacle to new capital inflow.
Historically, the first quarter of Bitcoin is usually a bullish period, as demand surges due to supply shocks, creating economic imbalances. However, considering the complexity of the current market, external factors are gradually becoming more powerful, and even if on-chain indicators remain healthy, the lack of clear economic signals may still pose a significant obstacle in 2025.
The prospects for a bull market rebound
Therefore, unless Bitcoin can break through its historical high point before mid-January 2025, it may be premature to declare a bull market rebound. Even participation from large institutions like MicroStrategy may not be sufficient to drive a market rebound. Instead, the consolidation range of $95,000 to $98,000 may be a necessary stage for Bitcoin to build momentum for the next wave of increases.
This phase will compress the profit margins of risk-averse investors, forcing them to stay in the market while igniting the 'fear of missing out' (FOMO) sentiment, laying the foundation for a potential rebound in the coming weeks.
Although the recent pullback has raised doubts among investors, Bitcoin's market momentum remains strong. With more capital entering and potential economic signals emerging, Bitcoin may still welcome a new bullish trend. However, investors must remain vigilant, as the volatility and psychological pressure in the market suggest that a new bull market rebound may not be imminent.
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