Simply put
- Bitcoin has decreased by 20% from its highest recorded value and would need a 10% bounce back to return to equilibrium this quarter.
- Analysts have pointed to U.S.-China tensions, closure risks, and low liquidity as reasons for the current range trading.
- The quarter’s positive outcome hinges on factors like inflation, liquidity, possible rate cuts, and consistent ETF inflows.
Bitcoin is currently moving sideways following recent downturns, with traders wondering if it can navigate major obstacles to wrap up the year positively.
Even amid the market’s fluctuations, some experts remain hopeful that Bitcoin will finish the fourth quarter strong. Yet, this perspective relies on specific conditions.
For Bitcoin to break even this quarter, it would need to jump at least 10% to hit the breakeven price of $114,000. Surpassing this mark could really lift the quarter’s performance.
The leading cryptocurrency is down roughly 20% from its peak of $126,080, a drop further exacerbated by a notable crash in October that resulted in $19 billion worth of liquidations.
Since November, a cautious sentiment has prevailed, with Bitcoin dipping around 15% in the past month. Stocks too are struggling, evidenced by the tech-heavy Nasdaq’s 3.4% decline in just the last week.
This downturn is largely attributed to ongoing macroeconomic and geopolitical uncertainties.
Daniel Liu, CEO of Republic Technologies, noted, “The U.S.-China trade war is likely to impact risk assets, including cryptocurrencies, more than people expect.” He also expressed concerns about potential government shutdowns creating market hesitation.
Adam Chu, chief researcher at GreekLive, remarked that this caution is evident in market behavior and diminished liquidity, alluding to crypto options data showing no clear advantage for either buyers or sellers.
“Instead, they anticipate the market to remain within a defined range,” said Chu.
He also warned about systemic risks, indicating that “invisible financial institution defaults could happen at any moment” and that ongoing defaults in DeFi and stablecoins might signal a looming crisis.
Nevertheless, experts still believe that achieving a surplus this year remains feasible, contingent on favorable macro developments.
“Bitcoin could definitely have a strong finish to the fourth quarter if inflation rates drop and liquidity improves,” mentioned Ryan Lee, chief analyst at BitGet.
He added that key influences might include a possible Fed rate cut and a weaker dollar, which could enhance risk appetite, along with the accumulation by long-term holders and increased ETF inflows signaling renewed optimism.
