Key Takeaways:Bitcoin remains far from overbought, suggesting more room for upside despite hitting a new all-time high above $126,000 this week.Bitwise CIO Matt Hougan predicts record-breaking ETF inflows in Q4 2025, saying the “stars are aligned” for renewed institutional demand.Bitcoin ETFs have already attracted $22.5 billion in 2025, and Hougan expects that figure to surpass $36 billion by year-end.Analysts note that low volatility and a steady upward trend indicate BTC is still in the mid-phase of its four-year cycle.The “Debasement Trade” narrative — investors shifting toward Bitcoin and gold as the U.S. dollar weakens — could further accelerate inflows.Bitcoin Still Has Room to Run as Market Stays Below Overbought LevelsDespite touching a fresh all-time high above $126,000 earlier this week, Bitcoin (BTC) remains well below historical overbought levels, signaling more room for gains, according to market analysts.CryptoQuant contributor Arab Chain said Bitcoin is currently “roughly halfway through its four-year price cycle,” suggesting the market remains in a mid-phase rally rather than a euphoric top.“Despite strong performance, technical indicators show Bitcoin is still moving within a stable range, far from the overbought conditions that have preceded previous cycle peaks,” Arab Chain said Wednesday.Technicals Point to Steady Uptrend and Low VolatilityData shows Bitcoin’s 30-day moving average sits just under $116,000, reflecting a balanced upward trend with no signs of overheating.The 30-day standard deviation, which measures volatility, remains relatively low at $4,540, a compression that typically precedes strong directional moves — often upward when paired with rising liquidity inflows.“Bitcoin appears to be in a phase of balanced upward momentum,” CryptoQuant noted. “If liquidity inflows accelerate, volatility compression could trigger the next leg higher.”Historical data shows Bitcoin tends to reach its cycle peak 500–600 days after halving. Since the latest halving occurred in April 2024, BTC is now entering the “critical window” that has previously led to major bull market tops.Bitwise: “Stars Are Aligned” for Record Q4 ETF InflowsThe next major catalyst, according to Bitwise CIO Matt Hougan, could be a record wave of Bitcoin ETF inflows in the final quarter of 2025.Hougan told investors Tuesday that Bitcoin’s rising price and mainstream acceptance would fuel a new surge in ETF demand, driven by financial advisers and institutions adding exposure to client portfolios.“Here’s a hot take: I’m not worried,” Hougan said. “From where I sit, the stars are aligned for a very strong Q4 for flows — more than enough to push us to a new record.”Hougan expects Bitcoin ETFs to pull in more money in 2025 than during their record first year, when they saw $36 billion in inflows. So far, $22.5 billion has entered Bitcoin ETFs this year, with $3.5 billion in net flows recorded in just the first four trading days of Q4.“We have 64 more days to get another $10 billion,” he added. “I think we’ll do that — and then some.”Higher Prices Could Fuel Even Greater DemandHougan explained that rising Bitcoin prices historically attract more inflows into ETFs, as both media coverage and investor interest intensify during bull markets.“Although it’s counterintuitive, higher prices often spur greater demand for Bitcoin ETFs,” he said. “In every quarter where Bitcoin saw double-digit growth, ETF inflows also hit double-digit billions.”This trend aligns with the so-called “wealth effect”, where institutions and retail investors alike chase outperforming assets to boost end-of-year portfolio returns.The “Debasement Trade”: Why Wall Street Is Turning to BitcoinAccording to Hougan, macro conditions are further strengthening Bitcoin’s bull case. A weakening U.S. dollar is prompting wealth managers to rotate capital toward “hard assets” like gold and Bitcoin — a move he dubbed the “Debasement Trade.”“When advisers sit down with clients for their annual reviews, they want portfolios that include the best-performing assets. There’s only one way to do that: by buying gold and Bitcoin,” Hougan said.Recent developments among major institutions back his view. A Morgan Stanley report released earlier this month advised its 16,000 financial advisers that they can now “flexibly allocate to cryptocurrency” within client portfolios, suggesting allocations of up to 4% for risk-tolerant investors.Q4 Outlook: Institutional Liquidity Meets Bullish Market StructureWith Bitcoin’s technical setup showing low volatility, ETF inflows accelerating, and institutional platforms opening up, analysts believe conditions are aligned for continued upside into year-end.The convergence of ETF demand, macro tailwinds, and structural supply constraints from the halving has created what some are calling the “perfect storm” for Bitcoin’s next major move.If inflows continue at the current pace, Bitcoin ETFs could surpass $30 billion in total inflows for 2025, setting a new record and providing sustained buying pressure through Q4.“The combination of liquidity, institutional access, and strong fundamentals keeps Bitcoin well-positioned for further price discovery,” analysts concluded.Market SnapshotAt the time of writing, Bitcoin trades at $121,726, holding near recent highs and maintaining steady upward momentum.Traders continue to monitor ETF inflows, U.S. dollar trends, and macro signals as BTC enters what could be its most pivotal quarter of the current cycle.
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