Throughout most of 2024, Bitcoin (BTC) struggled to break out — then, after the US presidential election on November 5, the wider cryptocurrency market entered a bull run.
The price of BTC reached a new all-time high (ATH) on December 16 — the leading digital asset briefly traded above $106,000, before receding below the $100,000 mark.
On the whole, 2024 saw BTC prices increase by 119.03% in 2024.
Since that high, Bitcoin has found a strong level of support at $92,600 and is currently struggling to stay above $95,000 consistently. At press time, the digital asset was changing hands at a price of $96,800 — having marked a modest 2.53% uptick since January 1.
Up to now, overall sentiment has been rather bullish — but an increasing number of investors are deciding to lock in their gains. While that would not necessarily constitute a bearish signal on its own, the asset’s short-interest ratio has also seen a remarkable surge since the start of 2025.
Are Bitcoin investors preparing for another pullback?
On the last day of 2024, some 67.1% of Bitcoin positions were long — with a still notable minority of positions, 32.9%, to be exact being, short bets, per data retrieved by Finbold from Binance.
By press time on January 3, the situation had changed significantly — at present, only 53.4% of open positions are long — while Bitcoin short interest had risen to 46.6%. While the market hasn’t turned entirely bearish, the long/short ratio has dropped from 2.04 to 1.15 in a matter of days — and at this pace, short positions could outweigh long positions in a very short timeframe.
Readers should note, however, that even an indicator as clear as the long/short ratio never provides the full picture.
In comparison to previous market cycles, Bitcoin’s Relative Strength Index (RSI) has yet to peak, per noted technical analyst Ali Martinez, who also noted the recent increase in short interest in a January 3 X post.
Institutional investors like BlackRock (NYSE: BLK) have retained their bullish outlook on the pioneering cryptocurrency — and so have popular investors such as Robert Kiyosaki.
While the long-term prospects of Bitcoin might be intact, further short-term moves are not out of the question. The market could be shifting into alt season — so investors and traders should consider looking into smaller digital assets — at least until Bitcoin’s uptrend resumes.
Featured image via Shutterstock
