Will Bitcoin Break Through the $90,000 Barrier Soon?

Recent insights indicate that Bitcoin is experiencing substantial sell pressure, which is the highest it has been in three years. Despite negative sentiment in the cryptocurrency market, there are indications that Bitcoin's price may temporarily dip before rebounding. Analysts suggest traders should keep a close watch on price movements closely tied to market metrics and liquidity zones.

Key Takeaways

Bitcoin faces intense sell pressure, the highest in three years, following a notable crash.
Current sentiment is weak, with expectations of a price drop to around $82,000 before possibly climbing to $95,000.
On-chain metrics suggest Bitcoin is near its fair value but should not necessarily be seen as a buying opportunity.
Key liquidity zones for Bitcoin include $83,500 and $94,700, with a notable focus on the $90,000-$92,700 area.
The upcoming days may see sideways price action amid short-term volatility, attributed to options expiry.

Here's why the Bitcoin price could finally succeed in breaching the $90k ceiling

Understanding Bitcoin's Current Price Dynamics

Bitcoin Onchain Fair Value

In a recent post on X, on-chain analyst Root observed that Bitcoin is trading close to its on-chain fair value, based on factors like realized capitalization and coin days destroyed. Since March 2024, this metric has often indicated that Bitcoin was overvalued, with prices venturing into extremely overvalued levels towards the end of the year.

Bitcoin STH Realized Price vs Net Pressure

According to analyst Axel Adler Jr, the current decline into the fair value range does not automatically provide a buying opportunity. He pointed out that the market for short-term holders is experiencing a rare moment of pressure balance. In fact, the metric indicates equal buying and selling activity, a situation that has only been observed in 5.8% of all three-year analyses, suggesting traders are uncertain about the future trend.

Bitcoin Liquidation Heatmap

The liquidation heatmap shows that the $83,500 and $94,700 levels are significant areas of interest, with the $90,000-$92,700 zone identified as an important liquidity cluster.

Bitcoin 1-day Chart

Observing the one-day chart, it becomes clear that Bitcoin's price movement lacks a definitive trend in December, leaning towards the bearish side. A dip towards the $84,000 liquidity pocket appears increasingly probable due to the current bearish structure. To shift the sentiment towards a more bullish outlook, prices would need to rise above levels of $101,700 and $107,500.

Final Thoughts

Disclaimer: The information included in this article is not intended as financial, investment, trading, or any other form of advice and solely represents the author's opinion.