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Bitcoin fell to $86,612 on Wednesday after briefly rallying to $90,165, extending a month-long consolidation between $82,000 and $95,000 as $160 million in leveraged positions were liquidated in the past 24 hours and spot ETFs recorded minimal inflows for December.
The pullback comes amid multiple headwinds: the Federal Reserve signaling fewer rate cuts in 2026, US spot Bitcoin ETFs suffering $3.5 billion in November outflows, and technical analysts warning that an emerging inverse cup-and-handle chart pattern could signal further declines.
A key factor weighing on the current Bitcoin price prediction is the resurgence of aggressive liquidations.
Data from Coinglass shows that the crypto market recorded over $540 million in liquidations in the past 24 hours alone, with Bitcoin responsible for approximately $160 million of that total.
“These liquidation clusters create a self-reinforcing feedback loop,” said analyst Michaël van de Poppe, founder of MN Trading.
Once leverage is flushed out, price tends to drift lower until real spot demand steps back in.
Derivative traders have remained defensive since the massive $19 billion liquidation event on Oct. 10, which followed an abrupt escalation in U.S.–China tariff tensions.
That shock triggered cascading forced sell-offs, pushing prices lower as stop-losses and margin calls snowballed across exchanges.
Institutional demand—long viewed as a stabilizing force in any Bitcoin price prediction—has also shown worrying signs of fatigue.
Data from SoSoValue indicates that U.S. spot Bitcoin ETFs have recorded just $21.36 million in net inflows so far in December.
That follows nearly $3.5 billion in net outflows in November, a stark reversal from the nearly $3.5 billion in inflows seen in each of the two prior months.
Bloomberg ETF analyst James Seyffart recently noted that ETF flows remain highly sensitive to macro signals, especially interest rate expectations, highlighting how fragile institutional conviction remains in the current environment.
Another blow to the near-term Bitcoin price prediction came from the U.S. Federal Reserve’s Dec. 10 rate cut.
While the move itself was expected, Fed Chair Jerome Powell struck a notably cautious tone, signaling fewer rate cuts heading into 2026.
Historically, cryptocurrencies tend to lose momentum when monetary easing slows, as liquidity expectations diminish.
Adding to the pressure, losses in artificial intelligence-linked equities such as Nvidia and Broadcom have dragged the Nasdaq lower, reinforcing a broader risk-off environment that has spilled into crypto markets.
Market psychology remains fragile. At press time, the Crypto Fear and Greed Index continued to flash “Extreme Fear,” underscoring widespread caution among retail and institutional participants alike.
Fear-driven environments often suppress dip-buying, limiting recovery attempts.
From a technical standpoint, Bitcoin price prediction models are flashing warning signs. On the daily chart, Bitcoin has been forming an inverse cup-and-handle pattern since mid-April.
The rounded decline following a failed recovery attempt fits the textbook structure of a bearish continuation setup.
This pattern typically signals that sellers remain in control, said veteran chartist Peter Brandt. A confirmed break below the neckline would open the door to deeper retracements.
Unless Bitcoin can reclaim key resistance levels and invalidate the structure, the inverse cup-and-handle suggests downside risk remains elevated.
For now, the Bitcoin price prediction outlook remains decisively cautious, with bulls needing a decisive catalyst to regain control.
