Bitcoin Rally Pauses Before $100K—Here’s What Could Happen Next
Bitcoin price came close to breaking through the $100,000 mark last week, reaching a high of $99,645 before encountering resistance. According to CryptoQuant analyst Percival, round numbers like $100,000 tend to create psychological barriers Serve Serves as the point at which a trader exits a position for “relative safety”.
Percival highlighted that Bitcoin has gained approximately 57% since climbing from $73,000 to $99,800, ranking it among the “top six consolidation zone exit rallies.” Nonetheless, CryptoQuant analysts say that Bitcoin may enter a consolidation phase.
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BTC faces resistance below $100,000: What does the future hold?
Percival stressed the importance of the volatility index, which measures market dynamics. According to him, the index indicates that Bitcoin’s weekly rally is fading. This suggests that the cryptocurrency may consolidate for a few weeks before another rally begins.
Percival analyzed previous market cycles, especially the 2020 one, noting that Bitcoin’s first post-consolidation adjustment lasted about three weeks and saw the price fall by 18%. If history repeats itself, the next rally may occur in late December.
The analyst also noted that long-term holder (LTH) behavior is a key factor in understanding Bitcoin. Current market dynamics. LTH currently has a profit margin of 350% and is at supply allocation stageapproximately 575,000 Bitcoins (worth approximately $58 billion) re-entered the market.
Still, demand remains strong, driven by inflows into Bitcoin exchange-traded funds (ETFs) and buying from institutional players like MicroStrategy.
Percival further explores short-term holder (STH) activity using the STH realized profit and loss indicator. He noted that short-term holders accounted for 30.2% of profits during this period.
Additionally, Bitcoin’s market cap to realized value (MVRV) ratio has exceeded 1.33σ, indicating that the coin’s average is approaching the 1.4σ region, corresponding to 40% unrealized profits. Historically, this area coincides with the first correction after the adjustment major rallyas observed at the end of 2020.
What happens next for Bitcoin
Going forward, Bitcoin’s trajectory may depend on several factors, including the pace of its consolidation phase and the behavior of institutional and retail investors.
If the current period of consolidation mirrors the pattern of previous cycles, Bitcoin may stabilize before attempting another breakout above $100,000. But short-term corrections are still possible, with LTH continuing to take profits and STH remaining active.
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The cryptocurrency market has also seen strong demand from institutional players, as evidenced by heavy inflows into ETFs. This suggests that despite short-term volatility, Bitcoin’s long-term outlook remains positive.
At the time of writing, BTC is trading for $96,353It has edged up 0.3% over the past day and now has a market capitalization of $1.9 trillion.
Featured image created using DALL-E, chart from TradingView
