Bitcoin struggles to hold on to key $100,000 level

Bitcoin edged lower on Thursday, struggling to hold on to the $100,000 level. If BTC price declines, support can be found at $90,800, while resistance may be encountered at the recent all-time high of $104,446. 

Ethereum price also wobbled on Thursday, briefly rising above $4,000 but failing to hold on to that key level. If EthEthereum'sice declines, it may encounter support near $3,250, while if it increases, resistance may be encountered near $4,080.

Bitcoin price rose above the $100,000 milestone last week for the first time in history, registering a new all-time high of $104,446. Bitcoin lost its upward momentum earlier this week, as many traders rushed to sell at record-high prices. A massive sell-off was triggered, which continued on Tuesday, as many traders rushed to close their positions. Bitcoin suffered its biggest liquidation since 2021 earlier this week and crypto market liquidation came in at almost $2 billion.

Crypto markets rallied on Wednesday on rising Fed rate cut expectations but their rally was halted on Thursday. Cryptocurrency prices are affected by central banks’ interest rates. High interest rates are restricting economic growth, putting pressure on risk assets, while the promise of rate cuts boosts crypto markets. Even though disinflation in the US is stalling, odds of a Fed rate cut in December went up after the release of the US inflation report on Wednesday. After the release of the US inflation report on Wednesday, market odds of a rate cut in December rose from 92% to 98%, propping up cryptocurrencies. 

Reports that Trump plans to appoint Paul Atkins as the new Chair of the Securities and Exchange Commission (SEC) boosted crypto markets last week. Atkins is currently the CEO at Patomak Global Partners and has served as SEC commissioner in the past. Atkins’ appointment raised market expectations of less stringent legislation for cryptocurrencies, propping up crypto markets.

US President-elect Donald Trump has openly declared his support of crypto markets, announcing that he will make the US ‘the crypto capital of the planet’. Growing expectations that the new government will adopt a pro-crypto regulatory and fiscal policy have been boosting crypto markets, especially since Donald Trump announced plans to accumulate a national Bitcoin stockpile. 

Geopolitical concerns are promoting a risk aversion sentiment, however, lowering the appeal of highigh-risksets such as cryptocurrencies. A 60-day ceasefire between Israel and Lebanon has been officially declared. Reports, however, that Israel has been repeatedly violating the ceasefire, lowered risk sentiment last week. Meanwhile, the civil waswar Syria was rekindled last week, further destabilizing the region.

BTC/USD 1h Chart

ETH/USD 1h Chart

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Written by:
Myrsini Giannouli

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