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- A look at why Bitcoin failed to soar above $100,000 last week.
- Why a pullback was inevitable and what to expect moving forward.
Bitcoin’s [BTC] came close to clocking a six-digit price tag, but it did not manage to do so. This was contrary to high expectations, and it has since then pulled back considerably, especially during the weekend.
The Bitcoin Fear and Greed Index demonstrates just how the sentiment has shifted over the last few days. It was still in extreme greed, but notably dropped from 90 at its peak last week to 79 at the time of observation.
Source: Alternative.me
As a consequence of the declining sentiment, Bitcoin experienced a decline from its peak of $99,588 on the 22nd of November.
BTC was exchanging hands at $93,837 at press time, indicating that there was some profit-taking during the last few days.
Also worth noting is that Bitcoin’s dominance dipped from its 61.53% peak last week to 58.70% at the time of writing.
Source: TradingView
The dip in dominance paved the way for heavy liquidity flows into some altcoins during the weekend. But this may have also prevented Bitcoin from reaching $100,000.
The Bitcoin ETF influence
Bitcoin ETFs were at the forefront of the massive rally last week, as evident by continuous days of inflows.
However, since they are run by companies, they operate only on weekdays, hence their demand tapered out on the 22nd of November and BTC was down by over 6% since that day.
Consequently, the momentum cooled off, paving the way for the bears to take over.
Bitcoin ETFs have also been seemingly taking advantage by taking some profits off the table. ETF data revealed that there was $435.3 million worth of BTC ETF outflows on Monday.
The weekend pullback, along with unexpected negative ETF flows, led to a surge in long liquidations. According to Coinglass, 80.99% of derivatives positions on exchanges were longs.
Approximately $121.33 million was liquidated in the last 24 hours.
Source: Coinglass
The recent liquidations were the highest that the cryptocurrency experienced in the last 12 days. In contrast, there were only $28.48 million in shorts liquidations in the last 24 hours.
Will Bitcoin resume its march towards $100,000?
The extreme greed and optimism for more upside combined with an extremely overbought nature meant a pullback was inevitable.
Read Bitcoin’s [BTC] Price Prediction 2024-25
As for whether BTC will regain the bullish momentum, that will largely depend on ETF flows.
Positive ETF flows may fuel another upside attempt. The recent pullback may also encourage more profit-taking, but the extent remains to be seen.
