Bitcoin analysts explain why BTC could avoid a drop under $90K

Bitcoin’s (BTC) price dropped to a new range low at $91,055 on Jan. 9, its lowest value since Dec. 1, 2024. The next psychological support range remains under $90,000, and some market analysts continue to forecast a decline below this level.

However, the following four reasons suggest that BTC may avoid a drop below $90,000.

Crypto Fear and Greed Index drops to 3-month low

The Crypto Fear & Greed Index dropped to 50 from a high of 78 after the BTC price dropped 9% between Jan. 7 and Jan. 10. The index that tracks broader market sentiment fell to its lowest value since Oct. 14.

Cointelegraph reported that the indexes recent plunge is its biggest drop over the past few years, which caused the sentiment to shift from a “greed” to a “neutral” zone.

Technically, this is a positive development as historically, BTC prices have exhibited a reversal whenever the index has dropped to a neutral or fear zone.

Bitcoin metrics indicate “market peak” is not in yet

Bitcoin raised bearish concerns after it failed to hold a position above $100,000 on Jan. 6.

A series of four liquidation events in 2-months indicated potential weakness and liquidity drought, and the markets prepared for another period of corrections. However, from a fundamental point of view, Bitcoin has triggered zero bull market peak indicators.

Data from CoinGlass highlighted that the apex crypto asset is yet to retest or surpass its previous market top signals. The bull market peak indicators consist of 30 conditions varying between charts and indexes, out of which none of the metrics kindled previous bull market highs from 2017 and 2021.

Mikybull, a crypto analyst, shed light on this development and implied that these price dips remain an “opportunity” before the expected rally.

Related: Fed officials lean ‘neutral’ on policy but expect clarity once Trump begins

Bitcoin whales bought 34K BTC after the end of year

While short-term volatility is shaking off weak hands in the market, large holders have been actively accumulating Bitcoin since the end of December.

Cauê Oliveira, Blocktrends head of research, mentioned that institutional investors have accumulated over 34,000 Bitcoin worth $3.2 billion since it dropped below $108,000 on Dec. 17. Oliveira added,

“Large players took advantage of the consolidation to open TWAP positions, patiently accumulating just below US $95K.”

This implied that institutional demand remained high despite BTC’s recent sell-off below $100,000. Additionally, MAC.D, a verified CryptoQuant analyst, said that while short-term investors were experiencing losses, it offered a window for accumulation rather than panic selling. He said,

“Selling coins at this juncture might prove to be a very unwise decision.”

Selling $6.5 billion BTC in six trading days seems “impossible”

One of the key bearish catalysts impacting Bitcoin price over the past two days is the rumor surrounding the US government potentially selling over $6.5 billion in BTC. In light of that, Miya, a crypto commentator, said that it might be “impossible” for the government to execute the sales within 6 trading days.

With President-elect Donald Trump taking office on Jan. 20, Miya highlighted the complexity of selling such high amounts of BTC during an imminent key political event. The issue gets more complicated because Trump plans to establish a Bitcoin reserve, which means it will potentially be a topic of discussion during his official appointment.

In short, the crypto enthusiast believed that a reversal is more than likely for Bitcoin since the market has already priced in the bearish speculation.

After sweeping the lows below the previous range on the daily chart, Bitcoin liquidity pools are now chasing the upside, as indicated by MikyBull. Although a wick below $90,000 for Bitcoin remains possible, the analyst predicted that a V-shaped recovery would be on the cards.

Related: Bitcoin speculators panic sell at $92K in ‘good time for accumulation’