Weekly Bitcoin Forecast: Bitcoin Price Drops Below $90,000, No Santa Rally in Sight

Bitcoin price hovers around $90,000, awaiting recovery catalysts.
Institutions have withdrawn more than $250 million from Bitcoin ETFs in December.
Bitcoin dominance has dropped below 60%, and a year-end rally may be delayed.

Bitcoin traders are banking on a year-end rally, hoping for a return above the $100,000 mark. Bitcoin-based investment products are struggling amid declining inflows and weaker institutional demand compared to the beginning of the year.

With shrinking institutional inflows, it’s becoming clear in the market that despite expectations of interest rate cuts and other positive regulatory developments, Bitcoin’s rally is likely nearing its end. In this analysis, we identify three main catalysts that could drive Bitcoin’s price higher, and outline key levels to watch next week.

- Top Three Catalysts for Bitcoin
Bitcoin holders are closely watching these three factors to determine the next price rally: institutional capital flows into US Bitcoin ETFs, Bitcoin dominance, and traders’ net profit/loss.

- Institutional Capital Flow
It is likely that Bitcoin’s price rally was driven by massive institutional inflows into US-based ETFs. Giant companies like Strategy (, formerly known as MicroStrategy), have added Bitcoin to their balance sheets, inspiring other major US companies to follow suit. Institutional demand was a key driver that pushed Bitcoin’s price to $100,000 and to its all-time high above $126,000. Naturally, as major players pull back from the market, institutional demand declines, and Bitcoin struggles to hold above the key support level at $90,000.

Bitcoin ETF Flows | Source: Farside

The $100,000 level served as support for Bitcoin for several months, but it has since turned into resistance, and a decisive close above this level may signal the return of a bull market.

Farside data shows Bitcoin ETF flows. Nearly $250 million have been withdrawn from these funds in December.

With capital inflows down, other metrics tracking Bitcoin’s significance and demand—such as Bitcoin dominance—are also pointing lower.

- Shrinking Bitcoin Dominance: Is This the End of the Rally?
Bitcoin dominance measures Bitcoin’s significance compared to other cryptocurrencies ((altcoins)) in the market. With Bitcoin’s market capitalization dropping to $1.79 trillion as of December 6, Bitcoin dominance is also declining. At the time of writing, Bitcoin dominance stands at 59.31%, below 60%.

Bitcoin Dominance Chart | Source: TradingView

Dominance has been above 59%, as it has been for most of the past two months. A rise in this dominance could be a catalyst for a Bitcoin rebound.

Typically, a drop in Bitcoin dominance signals the end of a rally and is followed by capital rotation into altcoins and other tokens in the market.

- Traders Selling Bitcoin at a Loss
If there is one metric that helps identify the state of the market, it’s the net realized profit/loss on the network. The on-chain metric on the Santiment platform tracks the net profit or loss traders make on a given day. For several days in November and December, the metric shows traders incurring losses—a sign of capitulation or increased selling pressure on Bitcoin.

Significant negative spikes in the indicator point to a change in Bitcoin’s price direction. After consistent profit-taking, traders are now registering losses on their Bitcoin holdings and are likely expecting further declines in Bitcoin price.

Bitcoin Network Realized Profit/Loss | Source: Santiment

If these large losses persist, it could negatively impact the price in the coming weeks.

In addition to the three catalysts, macroeconomic developments and expectations of interest rate cuts also influence Bitcoin’s price.