- Bitcoin Hodlers exited the cycle after cashing in huge profits.
- Is the beginning of a ‘new cycle’ near, or are we witnessing the end?
Bitcoin[BTC] Starting at $68k in November, but just two months later it rose to a new high of $109k—a massive 60% increase.
With such profits, profit taking was certain and only in December did investors cash in out A staggering $3 billion profit.
Now the market is waiting for a recovery. Otherwise, even holding Bitcoin at $100,000 could become a nightmare.
FOMO or Greed: Which Side Will Dominate?
Traders become less risky in the derivatives market, where leverage ratio shrinks quickly. This shows that they are not sure where the price of Bitcoin is going. Also, fewer people are moving bitcoin from exchanges.
In fact, exchange outflows saw a stunning drop of 16% in a single day.
Source: cryptoquant
Together, these factors suggest that FOMO is fading. However, greed has rebounded from “extreme” levels – a bullish sign. Why? Profit taking may be nearing its peak as indicated by a glass node report.
According to the report, profit taking has been reduced, falling from $4.5 billion in December to just $316 million now—a 93% drop. According to Ambcrypto, if FOMO returns as excessive greed subsides, it could set the stage for a significant price increase.
A look at the Bitcoin market
Bitcoin fell 3.26% in a day, but the market is not overheated. This means that strong buying, likely fueled by FOMO, is needed to push the price back up.
Source: TradingView
However, the upcoming FOMC meeting could significantly impact Bitcoin’s recovery. With the meeting just a week away, uncertainty is likely to persist, making a strong rebound less likely in the near term.
Interestingly, this consolidation period could be a positive sign. It can allow institutions to be calm accumulate Bitcoin as the market stabilizes after a period of significant profit making.
The key is what the Fed does. If they lower rates, things could get interesting. But if they surprise us, Bitcoin could dive further.
Read Bitcoins [BTC] Price forecast 2025–2026
For now, the market is showing signs of life. Greed is back and profit taking is cooling off. This could ignite a new buying frenzy, especially once the Fed Dust is established.
Keep an eye on the US economy calendar – It will ultimately determine whether extreme greed takes over or FOMO makes a comeback.