This post-election period stands out from previous cycles in a unique way. Historically, during high-risk phases for Bitcoin [BTC], investors tended to retreat.
Unexpectedly, in less than a week since the election results were announced, BTC has achieved three consecutive all-time highs, culminating in a new peak of $81K.
The ongoing surge in Bitcoin’s value symbolizes the evolving narrative promoted by the crypto community, advocating for digital assets as both a hedge against inflation and a means to counter centralized control in finance.
While the attractiveness of Bitcoin as an investment category is undeniable, the impact of speculative forces on its price trajectory cannot be ignored.
Despite the resilience shown by buyers throughout the recent period, several essential factors must align in order to sustain this upward trend.
Failure to meet these prerequisites could trigger a bearish reversal, potentially negating the progress made during this bullish run of Bitcoin.
Potential Slowdown in the Bitcoin Bull Run
As of two days ago, Bitcoin’s market dominance had dropped to 58.5%, recording a modest daily gain of 0.19% in its price. On the other hand, Ethereum [ETH] saw its market share rise by 3%, with a corresponding 5% increase in value during the same timeframe.
Amidst the ongoing Bitcoin bull run, this shift indicates a growing interest in alternative cryptocurrencies, diverting attention away from Bitcoin.
This trend typically emerges when traders believe Bitcoin has peaked in the market, prompting them to explore alternative options among altcoins.
Although Bitcoin achieved a significant weekly gain, propelling its value to a new all-time high of $81K, the impact on competing cryptocurrencies should not be underestimated, as several altcoins are even approaching triple-digit growth rates.
Upon analyzing daily price fluctuations, CryptoCrypto has identified a pattern supporting this shift.
Throughout every Bitcoin bull run, while initial momentum is fuelled by Bitcoin itself, as the cycle progresses, a substantial portion of capital tends to flow into alternative cryptocurrencies.
For instance, during the bull market in March, following Bitcoin’s ATH of $73K, it stabilized below that level. Nonetheless, altcoins like DOGE saw sharp spikes, surging to $0.20 within a span of fewer than 10 trading days.
This poses a pertinent question: With altcoins surpassing previous highs, could Bitcoin’s bullish momentum be drawing to a close? Or, considering the unique nature of this cycle, does BTC still possess untapped growth potential?
Critical Conditions for Bitcoin to Reach $100K
According to an analysis, to sustain Bitcoin above $80K, major HODLers need to view the current valuation as an attractive entry point. Such a stance would make it challenging for bears to initiate a correction.
The underlying rationale is clear: Bitcoin’s recent surge to an all-time high has placed all stakeholders in a profitable position, having purchased their assets at prices significantly lower than the current market level.
This renders Bitcoin more susceptible to price fluctuations, particularly as investors with weaker positions begin to sell off. In the event of a pullback, bullish investors are likely to rely on significant holders for support.
Presently, the market sentiment remains bullish, fuelled by broader economic and political circumstances, which are anticipated to maintain Bitcoin within the $79K-$81K range.
Nonetheless, in order to continue the Bitcoin bull run and breach the $100K milestone, the alignment of crucial prerequisites is imperative.
Should these conditions fail to materialize, a downturn may loom closer than anticipated, potentially prompting bears to reclaim authority across various indicators.