On Monday, January 20th, Bitcoin (BTC) stabilized above $93,000 following a wave of overnight selling, amidst subdued trading due to the US Martin Luther King Jr. Day holiday. The asset had previously dipped to $91,800 amid escalating geopolitical tensions. Concurrently, gold prices surged to a new all-time high, breaking through the $4,700 per ounce barrier, underscoring a strong market appetite for safe-haven assets. FXGT posits that in the current macroeconomically uncertain environment, the correlation between cryptocurrencies and traditional safe-havens like gold is strengthening, with investors keenly focused on the upcoming World Economic Forum in Davos, where remarks from political and business leaders are anticipated to be the primary catalyst for market volatility this week.
Thin market liquidity exacerbated asset price swings; although Bitcoin recouped some losses, it still recorded a decline of approximately 2% for the day, while Ethereum (ETH) and other major altcoins experienced more pronounced drops. Kraken executive Matt Howells-Barby noted that since mid-October last year, the crypto market has exhibited "asymmetric downside risk," meaning it reacts more sharply to negative news than to positive developments. FXGT indicates that data suggests the overnight pullback was relatively moderate (around 3.5%), hinting at potential underlying buy-side support, yet overall market sentiment remains fragile. This fragility was evident in the immediate market impact of the "Trump tariff threat" event, with investors seemingly speculating on a so-called "TACO" pattern (Threaten And then Ultimately Chicken Out), adding a further layer of speculation to short-term market direction.
Despite the intense short-term volatility, on-chain data reveals a glimmer of positive sentiment. Analysis from Bitfinex points out that selling pressure from Long-Term Holders (LTH) has significantly eased, dropping from a cycle peak of over 100,000 BTC per week to the current level of approximately 12,800 BTC. FXGT believes this data shift indicates that committed bulls are not panicking and exiting due to recent price corrections but may instead be accumulating at lower levels. However, technical challenges remain formidable; FXGT states that within the $93,000 to $110,000 range lies a dense supply resistance zone from long-term holders, which could act as a "ceiling" hindering further Bitcoin rallies. Looking ahead, FXGT's view aligns with analysts, suggesting that only when the market structure shifts to a pattern where mature supply exceeds long-term holder distribution can Bitcoin be expected to embark on a more sustained and robust upward trend.
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