Bitcoin has surged past the significant $90,000 mark for the first time in nearly a week, marking a potential turnaround after a month-long selloff. This rally comes in the wake of a drastic decline from an all-time high of $126,080 in October to nearly $81,000 just days ago. The recent positive momentum raises hopes among investors that the cryptocurrency market may be recovering from a bearish phase.
The rebound is not driven by typical retail enthusiasm but rather by a broader rally in risk assets, including technology stocks. A notable decrease in market volatility has also encouraged professional traders to push prices higher. The latest inflows into the BlackRock US Bitcoin Exchange-Traded Fund (ETF) indicate a shift in institutional sentiment, countering a recent trend of redemptions that had highlighted declining interest from institutional investors.
As the market anticipates a possible third interest rate cut from the US Federal Reserve in December, traders are closely monitoring whether this upward movement represents a fleeting recovery or the beginning of a sustained trend reversal. The recent price drop was largely attributed to decreased institutional interest and uncertainty regarding the Federal Reserve’s monetary policy. Historically, cryptocurrencies tend to perform well when the Federal Reserve lowers interest rates, as this makes riskier assets more attractive compared to safer investments like bonds.
Bond futures traders have significantly adjusted their expectations, with the likelihood of a quarter-point rate reduction now estimated at around 79%. This growing belief in future rate cuts is providing a positive macroeconomic backdrop for digital assets, allowing them to align more closely with equity market movements.
Institutional Support and Market Dynamics
The shift in capital flow into the BlackRock Bitcoin ETF is a crucial indicator of renewed institutional interest. Last week, Bitcoin had reached its lowest point since April, nearly erasing all gains made in 2025, as investors withdrew over $3.5 billion from Bitcoin ETFs throughout November. This trend mirrored the heavy sell-off seen in February, but the recent uptick in BlackRock’s fund suggests a potential end to the de-risking phase.
Market observers are now watching to see if Bitcoin can maintain its newfound strength through the Thanksgiving holiday and into December. Historically, Bitcoin’s performance around this time has been mixed, with an average return of -0.8% on Thanksgiving over the past decade. Nevertheless, the current rally, which saw Bitcoin rise more than 5% on Wednesday, stands out as a hopeful indicator of a reversal in fortunes.
The current trading price of Bitcoin stands at $90,035 (according to CoinGecko), still about 29% below the record high achieved in October. The rough two weeks preceding this rebound had led many analysts to speculate about the onset of a prolonged bear market, with predictions of a potential dip to $69,000. Analysts have pointed to declining liquidity, exacerbated by a significant crash in October that erased $19 billion in open interest, as key factors contributing to the downturn.
For the current rally to develop into a sustained uptrend, experts suggest that Bitcoin must decisively reclaim the price range of $100,000 to $105,000. The present trading environment, marked by reduced liquidity ahead of the US holiday and subdued liquidation data, indicates that bulls are testing whether the worst of the market downturn has passed. If Bitcoin can maintain its position, it could lead to substantial gains for other altcoins, including Ethereum, Solana, and XRP, which also experienced gains on Wednesday.
As the market continues to evolve, the focus remains on whether this rally can sustain itself and what implications it may have for the broader cryptocurrency landscape. Investors are hopeful that the combination of institutional support, favorable macroeconomic conditions, and market dynamics will foster a more stable and bullish environment in the coming weeks.
