Recently, the price of Bitcoin jumped as high as $105,490 before dropping quickly to below $103,000. Because of this trend, many investors are wondering: What is influencing Bitcoin, and where will it head up next? With all eyes on the next big event in the market, technical evidence and lawmaking may guide Bitcoin’s price in the year ahead. 

What Caused the Price Rise and Fall in Crypto?          

Bitcoin rose by 4% in the morning, approaching just a few dollars below its record high of $109,000. Yet, the enthusiasm did not last long because the price quickly dropped below $103,000. This is due to investors being simultaneously hopeful and careful. Optimism about a 90-day ceasefire in the trade war between the US and China lifted many risk assets. It appears that crypto traders especially seek more regulatory stability so that institutions can become more involved in the market.

The US Senate is expected to discuss a bipartisan bill called the Genius Act that relates to stablecoins. The senator underlines that the bill marks a new era with the creation of the first growth-oriented set of requirements for payment stablecoin use. A straightforward approach to crypto legislation could help Bitcoin and the market overcome shakiness and invite more money from larger institutions. CryptoQuant predicts that if Bitcoin’s crucial support stays at least above $90,000, it could reach nearly $120,000.

Novice traders must remember that a drop in CVDD means accumulation, while increased activity on the chart often indicates sellers trying to cash out their profits. With CVDD currently high, like in past peaks, Bitcoin may be approaching a market top, yet no top is certain if the support bands don’t break.

Projections look stable, yet there is still much uncertainty

With a 62.8% share in the $3.25 trillion crypto market, Bitcoin has been favoured by institutions recently, evidenced by recent spot ETF inflows of over $1.8 billion last week. At the same time, the overall volume on the stock market is down by nearly 18%, reflecting some uncertainties. If the price closes above $107,000, it could lead to new gains, and a loss of $90,000 support might bring about a decline. As regulation matures and on-chain indicators suggest Bitcoin may peak soon, the next few weeks will play an important role in telling us if the bull cycle continues or if any weaknesses in Bitcoin are revealed.