Image credit: The Byteline

Bitcoin briefly surged to $102,507 on December 12, coming within 1% of its all-time high before retreating to trade near $99,900. The cryptocurrency built on gains from the previous day, which saw a $5,000 price increase, as whale activity bolstered market momentum.

According to data from CoinMarketCap, the rally was driven by large-volume traders targeting sell-side liquidity. Trading resource Material Indicators highlighted the role of whales, stating, “Whales are back to making whale-sized market orders.” Using its proprietary FireCharts tool, the firm noted that whales were able to execute significant trades without slippage as Bitcoin encountered higher concentrations of ask-side liquidity.

Despite the bullish trend, sell-side pressure remained a limiting factor for Bitcoin’s price upside. Popular trader Skew observed that while passive buying continues, a breakout is likely to occur if this trend sustains. “As long as passive buyers continue to slurp, we break up eventually,” Skew told followers on X (formerly Twitter).

On-chain analysts urged caution, citing metrics that could indicate unsustainable growth. The Bitcoin Researcher, an on-chain analytics account, pointed to the Short-Term Holder Market Value to Realized Value (STH-MVRV) ratio, which measures profitability among investors holding BTC for up to 155 days. “A rising price without STH-MVRV reset often signals an impending market top—rarely sustainable for long,” they said.

Bitcoin’s rally came despite a surprise inflation report in the United States. The Producer Price Index (PPI) for November exceeded expectations, coming in at 3.0%, compared to the previous day’s Consumer Price Index (CPI) report, which aligned with forecasts. Market observers noted that the PPI data signaled a potential return of inflationary pressures, with some, like The Kobeissi Letter, questioning if the economy was entering an era of stagflation.

In light of the inflation data, attention turned to the Federal Reserve’s next move. CME Group’s FedWatch Tool placed the probability of a 0.25% interest rate cut at the Federal Reserve’s December 18 meeting at over 98%, reflecting expectations of looser monetary policy.

As Bitcoin continues to navigate macroeconomic uncertainty, whale activity and on-chain metrics remain pivotal factors influencing its trajectory toward new price milestones.

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