Bitcoin forecast: BTC surges over 100k – Where next?

Bitcoin rose above the key psychological 100k milestone on Thursday, reaching a record high of 103.9K, as the market cheered President-elect Donald Trump's nomination for the Securities and Exchange Commission (SEC).  

Bitcoin has broken out of its recent two-week range, rising 5% and ballooning its valuation to $2 trillion after Trump nominated Paul Atkins to replace SEC chair Gary Gensler on January 20th. Atkins has been vocally supportive of the crypto industry in recent years, boosting optimism that the sector will experience a more balanced oversight after years of scrutiny under Gensler. Furthermore, applications for SOL, XRP, and other ETFs will soon start piling up. Grayscale has wated no time joining the race to launch the first spot SOL ETF in the US. 

Within hours of the announcement, the crypto market cap hit a record $3.56 billion. Investors are hopeful that this could be the start of sweeping changes to benefit the industry, producing a tailwind for prices. 

Bitcoin is also supported by comments from Federal Reserve chair Jerome Powell. Powell highlighted the strength of the US economy but didn't shy away from a December rate cut. A lower interest rate environment is beneficial for risk assets such as Bitcoin as liquidity rises. Additionally, Powell compared Bitcoin to Gold, adding legitimacy to the asset. 

Retail investors return 

Institutional demand has done some of the heavy lifting, with spot BTC seeing record inflows of $6.4 billion in November. BTC ETFs have also commenced December on the front foot with three days of positive net inflows, attracting $1 billion in inflows.  

Meanwhile, retail investors' demand has also surged, reaching its highest point in years. Small players are returning as longer-term holders book profit. Adding to that, Santiment data shows that BTC social media mentions are up 72% today alone and 82% over the past 30 days. 

The break above the 100k psychological barrier will likely further ignite retail interest and draw in market participants. This could trigger a euphoric phase in the cycle amid inflows from both retail and institutional investors.  

Futures traders are sharing the optimism with a $1.54 billion long position at risk of liquidation should BTC fall back below 100k. Meanwhile, open interest surged 5% over the past 24 hours to $61.28 billion. 

How high can Bitcoin go? 

With expectations of a new institutional era and as Wall Street replaces Santoshi as the top Bitcoin Wallet, its difficult to be anything but bullish on Bitcoin. Market researchers such as Bernstein and banks like Standard Chartered predict 200k before the end of next year.  

Bitcoin forecast 

Bitcoin broke above its ATH of 99.8k, surpassing 100k to a peak of 103.9k. A continuation of the bullish trend could bring the psychological level of 110k into play. Above here, BTC could test the 1.0 Fib extension at 123k or even look as far ahead to the 1.61 fib extension as a peak (as it did in 2020) at 143k. 

The RSI is overbought, so buyers should be cautious as the chances of a consolidation or pullback increase. That said, RSI gives no indication of the timing, and Bitcoin could remain overbought for an extended period, as seen on previous occasions.