Bitcoin Weekly Forecast: Bitcoin Price Falls Below $90,000, No Sign of Christmas Rally Yet

Bitcoin price hovers around $90,000, awaiting a rebound catalyst.
Institutions have withdrawn over $250 million from Bitcoin ETFs in December.
Bitcoin dominance has dropped below 60%, and the year-end rally may be delayed.

Bitcoin traders are hoping for a year-end rally, expecting the price to return to and break through the $100,000 mark. Compared to the beginning of the year, Bitcoin-based investment products are facing challenges amid reduced capital inflows and weakened institutional demand.

As institutional capital inflows shrink, it is becoming increasingly clear that despite expectations for interest rate cuts and other positive regulatory developments, Bitcoin’s upward momentum may be nearing its end. In this analysis, we will identify the three key catalysts that could drive Bitcoin prices higher and list the critical levels to watch for next week.

- Three Key Catalysts for Bitcoin
Bitcoin holders are closely watching the following three factors to determine the next price surge: institutional inflows into US Bitcoin ETFs, Bitcoin dominance, and traders’ realized net profit/loss.

- Institutional Inflows
The rise in Bitcoin prices has largely benefited from significant institutional capital flowing into US Bitcoin ETFs. Giants like Strategy ( (formerly MicroStrategy)) have added Bitcoin to their balance sheets, encouraging other major US corporations to follow suit. Institutional demand is a key factor driving Bitcoin to $100,000 and setting new all-time highs above $126,000. As major players gradually exit the market and institutional demand decreases, it becomes difficult for Bitcoin to hold above the critical $90,000 support level.

Bitcoin ETF Flows | Source: Farside

The $100,000 level has long served as Bitcoin’s support, but it has now turned into a resistance level. If the price can firmly close above this level, it could signal a return to a bull market.

According to Farside, nearly $250 million worth of Bitcoin ETFs were redeemed in December.

As capital flows decrease, other indicators measuring Bitcoin’s importance and demand, such as Bitcoin dominance, are also trending downward.

- Declining Bitcoin Dominance: Is the Bull Market Over?
Bitcoin dominance measures Bitcoin’s market standing relative to other cryptocurrencies ( (altcoins )). As Bitcoin’s market cap fell to $1.79 trillion on December 6, Bitcoin dominance also declined. As of this writing, Bitcoin dominance stands at 59.31%, below 60%.

Bitcoin Dominance Chart | Source: TradingView

Dominance remains above 59% and has stayed at this level for most of the past two months. A rebound in dominance could serve as a catalyst for a Bitcoin rally.

Typically, a drop in Bitcoin dominance signals the end of a bull market, after which capital flows into other altcoins and tokens in the market.

- Traders Selling Bitcoin at a Loss
If there is one indicator to judge market conditions, it’s on-chain realized profit/loss. The on-chain metric from Santiment tracks traders’ net profit or loss on a given day. For several trading days in November and December, the indicator showed traders incurring losses, indicating market panic or increased Bitcoin selling pressure.

Sharp negative values in the metric often signal a change in Bitcoin price trend. After a period of steady profits, traders are now recording losses on their Bitcoin holdings and are likely expecting further price declines.

Bitcoin Network Realized Profit/Loss | Source: Santiment

If large losses continue, it may negatively impact prices in the coming weeks.

In addition to the three major catalysts above, macroeconomic developments and expectations for interest rate cuts will also affect Bitcoin prices.