In a striking reversal, bitcoin has surged over 10% in the past week, erasing nearly all losses from December and reclaiming the key $102,000 level. The rally comes as crypto traders eye $109,000 as the next major target amid building bullish sentiment ahead of Donald Trump’s inauguration as U.S. president.
Monday saw a standout day for bitcoin-focused exchange-traded funds (ETFs), with inflows totaling a whopping $987 million, the highest since November according to data from SoSoValue. Fidelity’s FBTC led the pack with $370 million, followed by significant inflows into funds from BlackRock and Ark Invest. The strong ETF demand signals renewed institutional interest as the crypto markets rebound from December’s dip.
Trump Anticipation Fuels Bitcoin Bullishness
Market observers point to mounting excitement over Trump’s expected crypto-friendly policies and broader economic agenda as a key driver behind bitcoin’s resurgence. Jeff Mei, COO at BTSE exchange, notes that traders have resumed bitcoin purchases “in a bullish trend as we approach Donald Trump’s inauguration” following a brief lull in activity over the holidays.
We believe that the demand for bitcoin is manifesting itself after a downbeat Fed outlook in late December put the brakes on a Santa Claus rally. Now that traders have wrapped up their vacations and are back to work, they’ve resumed purchases of Bitcoin, crypto, and stocks in a bullish trend as we approach Donald Trump’s inauguration.
– Jeff Mei, COO at BTSE exchange
Traders Target $109K Bitcoin Price
With bullish momentum building, many traders now have their sights set on bitcoin retesting its previous high around $109,000. FxPro analyst Alex Kuptsikevich sees the recent move as a “classic correction” that could set the stage for fresh upside.
So far, the technical picture looks like a classic correction completion with a resumption of the growth from the Fibonacci retracement level of 61.8% of the rally since the beginning of November. This scenario will be confirmed if the historical highs of around $109,000 are confidently breached. At the same time, we expect Bitcoin’s growth to accelerate after the $100,000 mark.
– Alex Kuptsikevich, FxPro chief market analyst
Some analysts view bitcoin’s ability to retake the key Fibonacci retracement level as evidence that the correction has run its course, opening the door for a retest of the highs. If bitcoin can decisively clear the $109,000 hurdle, it would likely kick off a new wave of buying pressure.
Low Volatility Expected Ahead of Jobs Report
In the short-term, crypto market volatility is expected to remain subdued until Friday’s release of the closely-watched U.S. nonfarm payrolls (NFP) report. Augustine Fan, head of insights at SOFA, believes the jobs data will “kick-start the new trading year” as key decision-makers return from the holidays.
A strong NFP print could boost the U.S. dollar and reignite expectations for higher interest rates, which tends to weigh on risk assets like stocks and bitcoin. However, Fan sees the late January FOMC meeting as this month’s “highest volatility event” as economic data begins to show signs of a “soft landing” for the U.S. economy.
For now, though, crypto traders appear squarely focused on the bullish narrative unfolding as Trump’s inauguration day inches closer. With bitcoin already up 10% year-to-date and leading the crypto market higher, many see the recent strength as a precursor to a broader altcoin rally to come.
As of early Tuesday, bitcoin trades just north of $101,600, while the CoinDesk 20 index, tracking top crypto assets, is up over 0.5% on the day. The positive start to the year has reignited optimism that 2025 could be another banner year for digital assets, especially with a crypto bull entering the White House.
