Although Bitcoin broke through the $100,000 mark yesterday, it only lasted for about 24 hours and then quickly fell back. With many companies increasing their investment and institutional investors withdrawing funds recently, Bitcoin once reached a high of nearly $103,000. However, the bulls failed to continue the upward trend. It happened to coincide with the release of the employment report and the employment was better than expected. Affected by a series of strong economic data, the market's expectations for interest rate cuts cooled, the US bond yields soared, and the US stock market pulled back simultaneously. Bitcoin suffered the biggest drop in two weeks and once again lost the $100,000 mark.
This round of sharp drop triggered a large amount of liquidation of leveraged positions. The total liquidation volume (liquidation amount) of cryptocurrency market futures contracts in the past 24 hours reached US$599 million, of which more than US$540 million came from long positions.
The reason is that the US stock market ended its two-day rally and turned to decline. According to data from the Institute for Supply Management (ISM), the performance of the US service sector in December exceeded market expectations, and the input price index rose to a near two-year high.
In addition, the U.S. Bureau of Labor Statistics (BLS) released the Job Openings and Labor Turnover Survey (JOLTs) in November last year, showing that the number of job vacancies exceeded expectations by a large margin, reaching a six-month high, further proving that the labor market is solid. A series of strong economic data caused U.S. bond yields to soar, hitting the stock market and cryptocurrency market.
The strong labor market has tempered expectations for monetary policy easing and also suggests that rate cuts are no longer a priority. This is also consistent with the CME FedWatch tool's forecast that the Fed has a 95% chance of keeping interest rates unchanged at its January 29 meeting.
After Bitcoin broke through $100,000, some investors chose to take profits and triggered stop-loss orders on long positions, further exacerbating the decline.
In addition, the news that Trump has been wavering on trade tariffs since his election has added uncertainty to the market. The volatility of the U.S. bond market has further aggravated the market's cautious sentiment towards Bitcoin.
Although Bitcoin has fallen sharply, the day before, Bitcoin spot ETF attracted a net inflow of $987 million, the largest since November last year, indicating that funds are still entering the market in large quantities.
On the other hand, this wave of decline is more likely related to the "spoofing" operation, which is a behavior in which large funds deliberately transfer liquidity on the order book, causing prices to fluctuate greatly in a short period of time. The order book liquidity data in the figure below shows traces of several transferred liquidity blocks.
Will Bitcoin drop to 90,000?
As for the future of Bitcoin, the current support level of 9.5 is stable. If it can stabilize, this wave of correction is basically over. If it continues to fall, it may retest the low of 90,000-92,000 US dollars. You can pay attention to the support of the 50-day moving average, which happens to fall near the above-mentioned support area.
The current pullback is just a normal pullback, and the lower support level is around US$95,000 and US$90,000.
If Bitcoin wants to resume its upward momentum, it must regain the $100,000 mark.
After the Coinbase Premium Index turned positive in early 2025, the buying pressure from US retail investors has also clearly resumed. The price has now broken through SMA14, which is a strong bullish signal. History shows that whenever the index crosses SMA14, the Bitcoin price usually experiences strong growth.
Always remember that chasing the rise is not a good strategy, and a decline is a good opportunity to buy. Recently, I have been telling everyone not to rush when the price rises, and don't chase it too much, there are many opportunities.
In addition, today the member group will also show you some spot targets and provide step-by-step airdrop tutorials. If you want to know more, you can send a private message to 666 in the background to receive it.
