Bitcoin is currently trading around $89,930 at the time of publication, up 1.77% in the past 24 hours, according to CoinMarketCap. Quinlivan noted that a quick rise in Bitcoin’s price to reach this level will show the “true reaction from retailers.” “Are they starting to pour in money because they’re saying Bitcoin goes up? That would be bad,” he said. Retail euphoria in crypto markets has always pushed towards all-time highs or cycle peaks, and going by history, the market has dropped shortly after.
In addition, analysts have previously argued that when the market excitement gets too intense, the crypto market has always moved in the opposite direction to what most people expect. The Crypto Fear & Greed Index, a metric that measures the overall crypto market sentiment, posted a “Fear” score of 29 in its Saturday update. The Index has been hovering around the “Fear” and “Extreme Fear” region since early November.
Analysts predict a short-term rally for Bitcoin
January has always been a historic month for Bitcoin and Ethereum, with average gains of 3.75% for BTC and 19.07% for ETH, according to data from CoinGlass. Meanwhile, Cryptopolitan has reported that Bitcoin could face a difficult start to the new year after the premier asset gave back most of the gains it accrued in the past three months. The token dominated headlines in the early part of 2025, thanks to Donald Trump shining a light on it after taking back the White House.
However, some analysts have added that they expect Bitcoin to undergo a rebound, even if the recovery will not last. Citi analyst Alex Saunders has mentioned that near-term support could come from the expansion of crypto exchange-traded funds, which will continue to provide better access to retail and institutional investors. He highlighted that the prediction assumes adoption will continue and ETF inflows would reach $15 billion, but noted that the level can only sustain the prices for a short while.
Meanwhile, attention will remain on Strategy, the largest corporate holder of Bitcoin, as another beacon for price movement. According to JPMorgan strategist Nikolaos Panigirtzoglou, the company’s enterprise-value-to-holdings ratio, which is above the 1.0 level, reassures the company that it would not consider selling its holdings during stress. “If this ratio stays above 1.0 and MicroStrategy can eventually avoid selling bitcoins, markets will likely be reassured, and the worst for bitcoin prices will likely be behind us,” Nikolaos said.