Bitcoin Magazine

Bitcoin Price Fights for $88,000 as Fed Looms and Bearish Technical Pressure Builds

The bitcoin price steadied a bit today after an early slide to $86,000 over the weekend, as traders weighed Federal Reserve risk, heavy recent liquidations, and growing technical pressure.

The largest cryptocurrency was up about 1% at $87,850 by midafternoon, after falling as low as $86,000.13 earlier in the session. Price action remained volatile, with market participants cautious about sharp reversals following a weekend selloff.

Attention is now centered on the Federal Reserve’s policy decision due Wednesday. The central bank is widely expected to keep interest rates in the 3.50%–3.75% range, but the meeting has drawn unusual scrutiny amid debate over the Fed’s independence. 

Recently, President Trump’s administration escalated its fight with Federal Reserve Chair Jerome Powell by starting a rare criminal-investigation threat tied to Powell’s oversight of a big Fed renovation project.

At the same time, Trump is pushing to reshape the central bank leadership as Powell’s term ends this spring, drawing legal pushback (including a Supreme Court case over Trump’s attempt to remove a Fed governor) and sparking a broader debate over the Fed’s independence from politics.

Crypto markets continue to absorb the impact of continued selloffs, which was exacerbated by forced liquidations across leveraged positions. 

U.S.-listed spot bitcoin exchange-traded funds remained a source of pressure. Spot bitcoin ETFs recorded $1.33 billion in net outflows in the week ending Jan. 23, marking the largest weekly outflow in nearly a year. 

The redemptions have contributed to selling pressure amid already fragile market conditions.

Corporate bitcoin accumulation persisted but failed to stabilize sentiment. Strategy., the software company that has shifted toward a leveraged bitcoin acquisition strategy, disclosed in a recent SEC filing that it purchased 2,932 bitcoin between Jan. 20 and Jan. 25 for approximately $264.1 million, paying an average of $90,061 per coin. 

The firm now holds 712,647 bitcoin, with the latest purchases financed primarily through its at-the-market equity offering program. These purchases did little to change the bitcoin price.

The company’s aggregate purchase price for its holdings stands at approximately $54.2 billion, including fees and expenses, translating to an average acquisition bitcoin price of $76,037.

Bitcoin price analysis

According to Bitcoin Magazine analysts, the bitcoin price posted a sharp bearish reversal last week, closing the week near $86,588 after failing to hold momentum following a test of $98,000 resistance. The move marked a decisive loss of the $87,000 support level and shifted near-term market control back to sellers.

The $84,000 level is now critical. A sustained daily close below that support could accelerate downside pressure toward the $72,000–$68,000 zone, with a deeper retracement toward $58,000 possible if selling intensifies. 

Bulls are expected to defend $84,000 aggressively to avoid a broader breakdown.

On the upside, buyers must first reclaim $88,000 to stabilize price action. Additional resistance sits at $91,400 and $94,000, while $98,000 remains a major ceiling. A move above that level is considered unlikely in the near term, though a breakout could open a path toward $103,500.

Technical indicators reinforce the bearish outlook. Bitcoin price closed below the 100-week simple moving average, the MACD remains in bearish territory, and the relative strength index has turned lower again. 

This coming week is pivotal, with broader market earnings potentially influencing sentiment, though correlations with equities remain uncertain.

At the time of writing, the Bitcoin Fear and Greed Index is currently at 20 out of 100, signaling extreme fear among market participants. Historically, periods of extreme fear have coincided with heightened uncertainty and, at times, potential buying opportunities as prices trade below perceived value.

The bitcoin price is currently $87,698. It is currently -1% from its 7-day all-time high of $88,635, and 2% from its 7-day all-time low of $86,126.

This post Bitcoin Price Fights for $88,000 as Fed Looms and Bearish Technical Pressure Builds first appeared on Bitcoin Magazine and is written by Micah Zimmerman.

Crypto analyst TARA has predicted that the Bitcoin price will still rally despite bearish signals that have surfaced. She highlighted why the flagship crypto could reach this level and what could happen once it touches the price target. 

Analyst Predicts Bitcoin Price Surge To $99,000

In an X post, TARA opined that the Bitcoin price will reach $99,300, even though the flagship crypto is printing a bearish candlestick. She stated that BTC wants to touch this price target before it retraces deeper so that the correction does not break the critical support at $90,000. The analyst added that retracement levels for BTC will continue to be adjusted, with the new 2026 high above $97,000, while revealing subwaves on the way to the full target at $103,000. 

Notably, crypto traders are currently betting on the Bitcoin price rallying past the $99,000 level and reaching the psychological $100,000 level. Polymarket data shows a 48% chance that BTC will rally to $100,000 this month. This follows the flagship crypto’s recent rally from around $92,000 to above $97,000 following the release of the soft CPI inflation data earlier this week. 

The spot Bitcoin ETFs have also contributed to the Bitcoin price surge to start the year. In an X post, Bloomberg analyst Eric Balchunas highlighted that ETFs recorded net inflows of $843 million on January 14 and now boast 1-week net inflows of $1 billion and $1.5 billion year-to-date (YTD). With BTC rallying to $97,000 after trading sideways towards the end of last year, Balchunas opined that the buyers may have exhausted the sellers. 

Arthur Hayes Predicts Bitcoin Rally On Rising Liquidity

In his latest blog post, BitMEX co-founder Arthur Hayes predicted that the Bitcoin price could sustain this rally as dollar liquidity rapidly increases. Hayes expects dollar liquidity to increase as U.S. President Donald Trump finds more ways to inject liquidity into the economy. The BitMEX co-founder highlighted how Trump plans to lower mortgage rates, which could cause Americans to borrow more.  

Hayes also mentioned that the liquidity in 2025 didn’t support crypto portfolios, which is why the Bitcoin price underperformed. He urged market participants not to draw wrong conclusions from the 2025 underperformance, as it was always a liquidity story rather than a cyclical bear market, as some analysts suggested. 

More liquidity could also flow into the market as Trump nominates a rate-cut advocate to replace Fed Chair Jerome Powell. This could lead to larger rate cuts, which would be bullish for the Bitcoin price and the broader crypto market. 

At the time of writing, the Bitcoin price is trading at around $95,300, down in the last 24 hours, according to data from CoinMarketCap.

Bitcoin has entered a fresh bout of volatility after a rare and highly charged response from Jerome Powell, following reports that federal prosecutors have opened a criminal investigation related to his conduct as Federal Reserve Chair. In a direct and unusually pointed statement, Powell said: “The threat of criminal charges is a consequence of the Fed setting rates based on our best assessment of what will serve the public, rather than following the preferences of the President.”

The market reaction was immediate. Bitcoin dropped from the $92,500 area to nearly $90,500, reflecting heightened uncertainty as traders reassessed political and macro risks. The move interrupted an otherwise stable consolidation phase and reintroduced volatility at a moment when BTC was attempting to build support above the $90,000 level.

What makes this episode particularly notable is the shift in Powell’s public stance. Over the past 12 months, despite repeated criticism from President Trump, Powell consistently declined to engage, often responding with variations of “I have no response or comment.” That long-standing silence broke yesterday.

As markets digest the implications, Bitcoin now finds itself at the intersection of macro policy, political pressure, and investor psychology. The next reaction—both from policymakers and from risk assets—could prove decisive for short-term price direction.

Retail Fear Persists as Short-Term Holders Capitulate Within the Uptrend

A recent CryptoQuant analysis adds another layer to the current political and macro-driven volatility, revealing that retail investors remain fearful of short-term price swings even as Bitcoin maintains a broader upward structure. The Short-Term Holder SOPR (STH SOPR) highlights a recurring behavioral pattern that tends to appear during corrective phases within a larger bull trend.

Despite Bitcoin printing higher highs and higher lows throughout 2024 and 2025, short-term investors have been consistently realizing losses. Toward the end of last year, retail sentiment deteriorated sharply, with the STH SOPR dropping to around 0.98. Levels last seen in November 2022, when Bitcoin was trading near $16,000. While the indicator has not fully entered extreme capitulation territory below 0.98, it has remained under the neutral 1.00 level for more than 70 days, signaling sustained selling at a loss.

This divergence is critical when STH SOPR remains below 1.00, coinciding with extended consolidations or corrective phases, driven by heightened pressure since Bitcoin broke above its previous all-time high. Historically, periods where STH SOPR stays below 1.00 coincide with extended consolidation or corrective phases, driven by elevated fear and realized losses.

However, during the current uptrend, these episodes have repeatedly marked favorable accumulation zones. The mismatch between rising prices and capitulating retail behavior often reflects opportunity rather than weakness. This highlights Bitcoin’s underlying structural strength despite short-term volatility.

Bitcoin Consolidates Below Key Resistance as Volatility Compresses

Bitcoin’s weekly chart shows the market in a consolidation phase following a sharp correction from the October highs near $120,000. After losing the $100,000 psychological level, BTC found demand in the low-$80,000s before rebounding toward the $90,000–$94,000 range, where price is currently stalling. This zone has clearly become a short-term equilibrium. With buyers defending higher lows but struggling to generate enough momentum for a decisive breakout.

From a trend perspective, Bitcoin remains below the 50-week moving average, which is now acting as dynamic resistance around the mid-$90,000 area. In contrast, the 100-week moving average continues to slope upward well below the price. Reinforcing the idea that the broader macro trend remains intact despite recent weakness. The 200-week moving average, far lower, continues to define the long-term bull market structure.

Volume has compressed significantly during this consolidation, suggesting reduced participation and indecision. This typically precedes a volatility expansion rather than a continuation of slow, sideways trading.

As long as BTC holds above the rising 100-week moving average, downside appears structurally limited. Failure to reclaim the $94,000 resistance zone would keep the market vulnerable to another leg of consolidation before a sustainable trend resumes.

Featured image from ChatGPT, chart from TradingView.com