Bitcoin’s Wild Ride: $100K Support Level Tested Again! 🚀💰

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So, Bitcoin (BTC) just had to go and do what it does best – make economists scratch their heads. After reaching a new all-time high of about $109K on Monday, during the 2nd inauguration of the crypto-friendly US President Donald Trump, it decided to take a little dip. I mean, who doesn’t love a good rollercoaster? 🎢 Bitcoin price dropped over 5% in the last 24 hours to trade about $102,326 on Tuesday, January 21, during the mid-London session. The flagship coin is now playing a game of musical chairs with the crucial support level above $100K, for the second time. It’s like it’s saying, “You’re not the boss of me, market!”

Now, from a technical price analysis, Bitcoin has been retesting the bullish breakout from a narrowing wedge, which formed in mid-November. But hey, just because it’s been bullish doesn’t mean it’s going to stay that way. BTC closed Monday in a shooting star candlestick, which is like the market’s way of saying, “Hey, maybe we should be careful here.” 😅

But fear not, dear reader! The short-term bearish sentiment is being bolstered by higher-than-expected inflation and a more hawkish sentiment from the Federal Reserve chair. But hey, who cares about short-term stuff when you have a president who’s all about crypto? On the first day of office, Trump directed the government agencies to work on reducing inflation and the cost of living. It’s like he’s saying, “We’re going to fix this, one Bitcoin at a time!” 💪

Long-term investors are still banking on the adoption of Bitcoin by nation-states, especially when the Trump administration establishes a strategic BTC reserve. As Coinspeaker reported, several US states led by Massachusetts, Texas, and Utah have already introduced a proposal for a strategic BTC reserve. It’s like the states are saying, “We’re not just going to sit around and watch!”

Whale Investors Relentlessly Accumulate More Bitcoin

The demand for Bitcoin among institutional investors has remained high, as a hedge against global inflation, fiat devaluations, and macroeconomic market uncertainties. According to market data analysis by CoinGlass, Bitcoin’s open interest (OI) retested its all-time high above $67 billion. It’s like the whales are saying, “We’re in this for the long haul!” 🐳

Meanwhile, the overall supply of Bitcoin on centralized exchanges has continued to drop to a multi-year low of about 2.19 million, further escalating the supply vs demand shock. The anticipated entrance of nation-states into the Bitcoin industry has further increased the appetite of institutional investors. For instance, World Liberty Financial (WLFI) commemorated the inauguration of Trump with a strategic crypto purchase, worth over $100 million. The Trump family-backed DeFi protocol purchased $47 million in Wrapped Bitcoin, thus cementing the President’s position on digital assets. It’s like they’re saying, “We’re all in, and we’re not backing down!”

On Monday, El Salvador defied the criticism from the IMF and purchased 11 BTC, thus currently holding over 6,043 Bitcoins, worth over $611 million. It’s like El Salvador is saying, “We’re not afraid of the haters!”

Meanwhile, the US spot BTC ETFs have been major Bitcoin purchasers in the past year. Led by BlackRock’s IBIT and Fidelity’s FBTC, the US spot Bitcoin ETFs have accumulated more than 1 million BTCs, worth over $120 billion at the time of this writing. It’s like they’re saying, “We’re all about the long game!”

As a result, it is safe to assume that the future of Bitcoin is brighter than before, especially with Trump as the US president. It’s like the future is looking… well, more Bitcoin-y! 🌟

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2025-01-21 13:35