- Bitcoin has smashed it in 2024, breaking $100,000 for the first time
- Many predict that Bitcoin can go on to greater heights this year
- What do the technical and fundamental metrics tell us about 2025?
An ETF (actually, ETFs), breaking $100,000, Donald Trump’s victory…Bitcoin has smashed it 2024, without a doubt. However, can we expect the same in 2025 or is the rocket running out of fuel? Let’s find out.
Fundamentals
In 2024, Bitcoin reached unprecedented levels of adoption in the United States, becoming a mainstream financial asset. Its appeal as a hedge against inflation has resonated with Americans seeking alternative stores of value, particularly amid ongoing economic uncertainties, with many financial titans now on board. With Donald Trump taking the White House and employing pro-crypto individuals in key roles, the future has never been brighter for the sector.
In addition, Wall Street has embraced Bitcoin with open arms, with major financial firms offering Bitcoin-based investment products like ETFs and retirement accounts. Furthermore, the integration of Bitcoin into popular payment apps and platforms has made it easier than ever for Americans to use Bitcoin for both investment and day-to-day spending.
Fundamentally, Bitcoin has never been in a better position for mass adoption than it is now.
Technicals
2024 has also seen Bitcoin crash through the major milestone of $100,000, which is the region some see as a sign of the market topping out. Bitcoin’s bull run began in January 2023, and a two-year bull market is standard for Bitcoin, and there are more signs that the end may come in 2025.
Firstly, Bitcoin is closing in on double its prior cycle top and is more than 7x its cycle low set after the collapse of FTX, which took place more than two years ago. This is quite an incredible run and one that won’t last forever. One way to judge where a cycle may top out is to use the Fibonacci extension tool, one which has been eerily accurate to date:
This shows that a final push up to around $112,000 may be on the cards before the cycle comes to an end, although it must be remembered that these tools are only technical indicators using past performance.
Another indicator we can look at is the Pi Cycle Top Indicator, which has a very good track record of predicting the cycle top:
Again, we can see that Bitcoin has a little more room for expansion, but not a great deal.
Finally, we can look at the RSI for a sign of how overbought or oversold Bitcoin is:
The RSI shows us that Bitcoin is already hovering in the overbought region, and, given that this is the second time in the cycle in which this has happened, a reset is expected to follow.
These indicators suggest that having enjoyed a two-year bull market, Bitcoin is exhausted and in need of a long rest.
Correction Coming in 2025
All bull markets come to an end, and, in our view, 2025 will see the end of this particular bull run. While the fundamentals are better than they have ever been, one cannot ignore the technical aspects that have so often proved correct. While these are not 100% accurate predictors, they are bellwethers that can signal what may be on the horizon, and it is impossible to ignore the signs that the end of the good times may be near…for now.
