A positive finish hinges on inflation, liquidity, potential rate cuts, and steady ETF inflows.
Bitcoin remains in a sideways trend following a recent selloff, with market participants debating whether it can overcome significant headwinds to finish the year strong.
Despite volatility and a market downturn, experts remain optimistic and expect Bitcoin to end the fourth quarter on a positive note. That outlook, however, isn’t without contingencies.
Bitcoin needs to bounce at least 10% to reach the quarterly breakeven price of $114,000. A rally beyond this level would end the quarter in the green.
The top crypto is down roughly 20% from its $126,080 record high, according to CoinGecko data, a pullback exacerbated by the historic October crash that triggered $19 billion in liquidations.
Risk-off sentiment has seeped into November, pulling Bitcoin’s performance down 15% over the past month. Stocks, too, have faced similar trials, with the tech-heavy Nasdaq down about 3.4% over the last seven days.
Blame is being placed squarely at the feet of macroeconomic and geopolitical uncertainties, Decrypt was told.
“The U.S.-China trade war is likely to influence risk assets, including crypto, more than people expect,” Daniel Liu, CEO of Republic Technologies, told Decrypt. He added that the potential government shutdown is contributing to market hesitation.
That caution is reflected in market behavior and diminished liquidity, Adam Chu, chief researcher at GreeksLive, told Decrypt, pointing to crypto options data that suggests neither the bulls nor the bears are gaining an advantage.
“Instead, they anticipate the market will remain range-bound,” Chu said.
The analyst also highlighted systemic risks, warning that “unseen institutional defaults could strike at any moment” and that “recent continuous defaults in DeFi and stablecoins may signal the prelude to a crisis.”
Experts still maintain that a path to a positive finish for the year remains viable, provided a shift in the macro landscape.
“If inflation data stays contained and liquidity improves, Bitcoin could indeed close the fourth quarter on a positive note,” Ryan Lee, chief analyst at Bitget, told Decrypt.
Key drivers include potential Fed rate cuts and a weaker dollar, which could improve risk appetite, Lee added, noting how “long-term holder accumulation and rising ETF inflows” could be viewed as signs of renewed confidence.
