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Bitcoin price dynamics continue to capture global attention as December 4, 2024, unfolds with significant market activity. Exchange reserves have plummeted to their lowest levels in years, signaling a strong shift in investor behavior toward long-term holding. Bitcoin, currently trading around $96,481, has experienced a recent pullback from its peak of $99,600, reflecting market consolidation and cautious sentiment.
Despite short-term volatility, factors like reduced supply on exchanges, increased accumulation by long-term holders, and optimistic policy expectations from the re-elected U.S. administration suggest a bullish outlook. This analysis delves into Bitcoin price trends, chart patterns, and market sentiment to provide a comprehensive overview of its current trajectory.
Bitcoin exchange reserves have been consistently dropping, reaching their lowest levels in years. Significant withdrawals from exchanges like Binance and Coinbase, totaling over 171,000 BTC since the U.S. presidential elections in November 2024, signal a strong shift towards holding rather than trading. Exchange reserves, which were 3.2 million BTC in 2021, have now fallen to 2.46 million BTC by December 2024. This trend underlines the perception of Bitcoin as a long-term store of value.
Data from Glassnode indicates that long-term holders have added 185,000 BTC to illiquid supply within the last 30 days, bringing their total holdings to 14.8 million BTC. This figure accounts for approximately 75% of Bitcoin's circulating supply. The accumulation by long-term investors suggests confidence in Bitcoin’s future value, reducing the available supply for trading and contributing to potential price surges.
Despite the tightening supply, Bitcoin price recently saw a 2% decline, dropping below $94,000. The market witnessed $578.6 million worth of liquidations, with $90 million specifically from long positions on Bitcoin. This correction demonstrates the impact of over-leveraged positions and the importance of support levels.
Bitcoin rebounded quickly and is now trading around $96,481, maintaining strong support near $94,500. Resistance levels near $98,600 have proven difficult to breach, with the double-top formation visible on the charts signaling potential short-term resistance.
The weekly chart shows Bitcoin price action characterized by steady upward momentum since mid-2023. Key support levels near $94,000 and resistance around $98,600 define the current range. A failed breakout at $98,600 has introduced temporary selling pressure, but the long-term trend remains bullish.
The candlestick pattern highlights strong buying interest near support zones, as evidenced by longer wicks at lower price levels. The weekly moving averages (MA) provide further insights:
The 20-week MA is trending upward, supporting the bullish outlook.
The volume analysis shows increasing participation as Bitcoin approaches key resistance levels, signaling high interest among traders.
The hourly chart reflects short-term fluctuations, with Bitcoin trading within a range of $94,500 to $98,600. Moving averages (20, 50, 100, and 200) are converging, indicating a period of consolidation before a potential breakout. A sideways pattern has developed, with critical levels at:
Support: $95,000-$94,500
Resistance: $97,500-$98,600
Volume spikes during attempts to break above $97,500 suggest strong selling pressure, preventing further upward movement. The current consolidation phase reflects market indecision, with traders awaiting clearer directional cues.
The recent decline below $94,000 triggered liquidations across the market, affecting both long and short positions. Despite this volatility, sentiment remains optimistic due to reduced exchange reserves and increased long-term holdings. Analysts predict a potential supply shock as Bitcoin continues to move off exchanges, which could support a price rally toward $100,000.
Bitcoin’s price saw a significant rally following President Trump's re-election, reaching $99,600. Anticipation of crypto-friendly policies under the new administration has bolstered market confidence. These policies, combined with declining exchange reserves, are expected to support Bitcoin's long-term bullish trend.
The consolidation near $96,000 suggests the market is preparing for its next move. Key scenarios to watch include:
A breakout above $98,600 could pave the way for Bitcoin to test the $100,000 psychological level.
A breakdown below $94,000 might lead to further declines, with $92,000 as the next significant support level.
The tightening supply and increasing adoption of Bitcoin as a hedge against traditional financial risks point to strong long-term prospects. While short-term volatility persists, the overall market sentiment remains bullish, with significant upward potential as 2024 concludes.
