Bitcoin Price Analysis: BTC Back In The Red Despite Optimism Around Shutdown

Bitcoin (BTC) is back in bearish territory as its recovery stalled around the $107,482 mark, as buyer momentum waned at upper levels. The flagship cryptocurrency is down 1.59% during the ongoing session, trading around $104,346. 

According to analysts, Bitcoin’s next move depends on progress towards ending the ongoing government shutdown and more buying by institutional investors like Strategy. 

Institutional Investors Still Want Crypto 

Institutional investors still plan on increasing their exposure to Bitcoin (BTC) and other cryptocurrencies despite the sharp correction in October. According to a report by Swiss banking group Sygnum, over 61% of institutions plan to increase their cryptocurrency investments, while 55% had a bullish outlook for the short term. The report stated that around 73% of the institutions surveyed are investing in crypto due to expectations of higher future returns despite the October 10 market crash. 

However, investor sentiment is uncertain thanks to continued delays in key market catalysts, including the Market Structure bill and the approval of altcoin ETFs. Sygnum’s lead crypto asset ecosystem researcher, Lucas Schweiger, stated, 

“The story of 2025 is one of measured risk, pending regulatory decisions, and powerful demand catalysts against a backdrop of fiscal and geopolitical pressures. But investors are now better informed. Discipline has tempered exuberance, but not conviction, in the market’s long-term growth trajectory.”

According to Schweiger, despite October’s correction, demand catalysts and institutional participation remain at an all-time high. 

China Makes Big Bitcoin Claim 

China’s national cyber defense agency has claimed the US played a role in the multibillion-dollar hack of LuBian, once a major Chinese Bitcoin mining pool. The Chinese National Computer Virus Emergency Response Center (CVERC) recently published a technical analysis of the hack, which saw 127,272 BTC stolen. The hack occurred in December 2020 and remained unknown to the general public until Arkham reported it, calling it the largest ever Bitcoin hack. 

The CVERC’s analysis comes weeks after the US lifted a civil forfeiture complaint for 127,271 BTC (worth around $14.5 billion) in a criminal case against Prince Group founder Chen Zhi, who reportedly owned the 127,272 BTC held by LuBian before it was hacked. The US formally filed to seize the Bitcoin in mid-October, but already held the assets in custody, according to an indictment statement. 

“Those funds are presently in the custody of the US government.”

CVERC noted that the US government did not disclose in its indictment how it got access to the funds. It also claimed the US had been in control of the funds for over a year. Arkham data shows that the LuBian hacker wallet sent 120,576 BTC, almost its entire holdings, to an address labeled “US Government: Chen Zhi Seized Funds” in a single transaction on July 5, 2024. 

Bitcoin (BTC) Price Analysis 

Bitcoin (BTC) has registered a substantial decline during the ongoing session, with the price down over 2% at $103,164. The flagship cryptocurrency ended the weekend in positive territory, rising 2.36% on Sunday and settling at $104,694. Buyers retained control on Monday as the price rose 1.23% and settled at $105,979 before dropping during the ongoing session. 

Bloomberg Intelligence’s Mike McGlone believes BTC has entered a “do-or-die” phase as traders watch a narrowing price band for clues on which way the price will go. McGlone highlighted trend lines and monthly charts, pointing to a rollover pattern after the months-long climb that culminated in an October 6 high. According to McGlone, BTC must push back above this level to make a clear case for renewed upside. If it can’t, it risks sellers regaining control and pushing prices below its current price range. 

Analysts have also highlighted that long upper wicks have been appearing on recent candles. This indicates that buyers are being checked at upper levels. The 12-month SMA has also started to flatten after steadily climbing, indicating that the buying drive is slowing down. Trader and analyst Michael van de Poppe highlighted strong resistance between $108,000 and $110,000, stating that if BTC breaks past these levels, it could push above $115,000.

Meanwhile, Bitcoin’s apparent demand has flipped to positive, rising to its highest level since July as traders adopt a risk-on approach thanks to improving macroeconomic conditions. The Apparent Demand metric is a commodity metric that gauges demand and measures production (mining issuance) minus inventory (supply inactive for over 1 year). The apparent demand had been negative since October 8, bottoming out at around -3,930 BTC on Oct. 21 before rebounding. 

Spot trading volumes have also increased by 23% to $14.1 billion, indicating rising retail activity. 

“The rise in spot volume suggests stronger investor participation and a potential for a breakout move.”

BTC started the previous weekend in positive territory, rising 1.15% on Friday and settling at $109,555. Price action remained positive on Saturday and Sunday as BTC rose 0.45% and 0.44% to cross $110,000 and settle at $110,536. Selling pressure returned on Monday as the price fell nearly 4% and settled at $106,557. The bearish sentiment intensified on Tuesday as BTC slipped below $100,000, falling to a low of $98,892. However, it rebounded from this level to reclaim $100,000 and settle at $101,468. Despite the overwhelming selling pressure, BTC recovered on Wednesday, rising over 2% and settling at $103,869.

Source: TradingView

BTC returned to bearish territory on Thursday, dropping to a low of $100,235 before settling at $101,290. The price slipped below $100,000 again on Friday, falling to a low of $99,170 before recovering and settling at $103,284, ultimately rising nearly 2%. Price action was mixed over the weekend as BTC fell 0.97% on Saturday before rising 2.36% on Sunday and settling at $104,964. Buyers retained control on Monday as BTC rose 1.23% and settled at $105,979. Selling pressure has intensified during the ongoing session, with the price down over 2% at $103,490.

Disclaimer: This article is provided for informational purposes only. It is not offered or intended to be used as legal, tax, investment, financial, or other advice.

Share With Others