As of January 3, 2025, Bitcoin's price has been influenced significantly by recent economic developments, particularly the U.S. Federal Reserve's injection of $400 billion in liquidity into the economy on January 1. This move marks a potential shift from quantitative tightening to quantitative easing, a change that historically benefits Bitcoin and other cryptocurrencies [0a0dd95d].
Following this liquidity injection, Bitcoin's price hovered around $95,000, with bullish investors eyeing a critical resistance level at $97,000. Analysts suggest that breaking through this level could indicate a strong bullish momentum for Bitcoin. Conversely, failure to surpass this threshold may lead to a price retracement towards $93,000 or even $90,000 [0a0dd95d].
In the backdrop of these market dynamics, long-term holders have sold over 1 million BTC since September 2024, while short-term holders have increased their supply from 2.5 million BTC to 3.8 million BTC, indicating a shift in market sentiment [0a0dd95d]. Analyst Chicken Genius has predicted that the end of quantitative tightening in the first quarter of 2025 could favor Bitcoin's price recovery, further adding to the anticipation surrounding Bitcoin's next moves [0a0dd95d].
As Bitcoin navigates these turbulent waters, the interplay of macroeconomic factors and investor sentiment will be crucial in determining its trajectory in the coming weeks. The market remains on edge as it awaits further economic indicators that could impact Bitcoin's performance and overall market dynamics [7ca849b8].