TLDR
Bitcoin currently trading below $98,000 after briefly touching $100,000 on Dec 5th
Market liquidity inflow has slowed to $7 billion from previous $15 billion
Price finding support above $94,200 with resistance at $98,000
Strong correlation (0.6) observed with NVIDIA stock performance
Market leverage has normalized to healthier levels, potentially setting up for another push toward $100,000
Bitcoin’s price movement has entered a consolidation phase, trading between $90,000 and $100,000 in December 2024. After briefly touching the $100,000 mark on December 5th, the leading cryptocurrency has established support above $94,200, while facing resistance near the $98,000 level.
Recent market data shows a notable decrease in liquidity inflows to the cryptocurrency market. The weekly rate of change in the market liquidity impulse index, which tracks stablecoin mints, Bitcoin ETF inflows, and futures market changes, has dropped to $7 billion from previous highs above $15 billion recorded in November.
Technical analysis indicates the formation of a key bearish trend line with resistance at $97,800 on the hourly chart. The price currently trades below both $98,000 and the 100-hour Simple Moving Average, suggesting short-term overhead resistance at these levels.
The cryptocurrency has shown resilience by maintaining support above $94,200, with recent price action indicating a consolidation pattern. A recovery wave lifted the price above $96,650, reaching the 61.8% Fibonacci retracement level of the downward movement from $98,267 to $94,314.
Market structure analysis reveals multiple support levels, with immediate support near $96,500 and major support established at $95,000. The next critical support level sits at $94,250, with $92,000 serving as a backup support zone should selling pressure increase.
An interesting correlation has emerged between Bitcoin and NVIDIA (NVDA) stock performance, with a three-month correlation coefficient of 0.6. This relationship highlights Bitcoin’s increasing connection to broader technology market trends and risk assets.
The year-to-date performance comparison shows Bitcoin up 130%, while NVIDIA has gained 172%. This parallel movement suggests similar market psychology driving both assets, despite their different fundamental characteristics.
Trading volumes have remained steady during this consolidation period, indicating sustained market interest despite the pause in upward momentum. The market has seen a normalization of leverage levels, potentially creating healthier conditions for future price movements.
Looking at potential upside scenarios, a clear break above $98,000 could open the path to test $98,800. Should this level be breached, the next target would be the psychologically important $100,000 mark, followed by possible extension toward $102,000.
The stablecoin market, which plays a crucial role in crypto market liquidity, has shown slower mint rates compared to previous months. This reduction in new stablecoin creation has contributed to the overall slowdown in market liquidity.
ETF flows, another key component of market liquidity, have also moderated from their early November peaks. This adjustment in institutional investment pace has impacted the market’s ability to sustain moves above $100,000.
Technical indicators present a mixed picture, with the hourly MACD losing momentum in the bearish zone, while the RSI hovers below the 50 level. These readings suggest neutral to slightly bearish short-term momentum.
The futures market has shown signs of normalization, with funding rates returning to more sustainable levels compared to the elevated rates seen during the November rally. This indicates a more balanced positioning between long and short traders.
Market data indicates that the $94,314 price point has served as a recent swing low, while $98,267 marked a local high, establishing the current trading range that Bitcoin has respected over the past week.
The latest price action shows Bitcoin trading at $96,800, representing a 2.3% decline from the December 5th peak above $100,000. Trading volume across major exchanges has averaged $42 billion daily during this consolidation period.
