Bitcoin’s move above the $95,000 mark has caught attention, but it still looks more like a test than a decisive escape. While the rally has been fuelled by softer US inflation and improving global liquidity, one key pillar of a durable bull run remains absent: meaningful US spot demand. Without that participation, the upside risks losing momentum rather than accelerating.

That contradiction defines the current setup. Overseas investors are leaning into the macro tailwinds, and derivatives traders are being squeezed out of short positions. Yet American buyers remain noticeably cautious. Whether this advance turns into a lasting trend will hinge less on price strength and more on who joins the market next.

What’s driving Bitcoin’s latest move?

The initial spark came from US inflation data that undershot expectations, reinforcing the view that the Federal Reserve still has room to ease policy later this year. Cooling price pressures helped push Treasury yields lower and loosen financial conditions, a backdrop that has historically favoured Bitcoin and other risk-sensitive assets.

Politics added another layer. News that the US Justice Department issued grand jury subpoenas linked to the Federal Reserve unsettled markets and weighed on the dollar. That combination nudged investors toward assets seen as less exposed to central-bank credibility risk. Bitcoin climbed more than 4% on the day, while ether, solana, and cardano posted even sharper gains, rising between 7% and 9% in a single session.

Why it matters

US participation has long been the difference between fleeting rallies and sustained bull phases. When American capital intervenes, price movements tend to persist. When it stays on the sidelines, upside often relies on leverage and foreign inflows, making the rally more vulnerable to reversals.

Data from Singapore-based crypto exchange Phemex highlights this imbalance. A negative Coinbase premium, they note, points to “strong selling pressure and potential capital outflows from the US market”.

That signal is hard to ignore. The premium flipped negative shortly after the US election in November 2024 and has remained there for much of Bitcoin’s climb since. Regulatory uncertainty may explain the hesitation. 

Many US investors appear to be waiting on the Clarity Act, proposed legislation designed to clarify crypto oversight. With the Senate delaying a key markup until late January to secure bipartisan support, institutions remain cautious despite supportive macro conditions.

Impact on crypto markets

The price surge has already prompted a significant shift in positioning. More than $688 million worth of crypto derivatives positions were liquidated in a single day, with roughly $603 million coming from short sellers. Around 122,000 traders were caught on the wrong side of the move.

Those liquidations helped push Bitcoin through $95,000, but they also quickly rebuilt leverage. Open interest has climbed again as prices approach zones that previously attracted heavy selling. Rising leverage near resistance often leads to sharp swings in both directions, increasing the risk of volatility rather than a smooth continuation of the upward trend.

Zooming out, the broader market environment remains supportive. Asian equity markets are hitting record highs, silver has surged past $90 an ounce, and gold is trading just below its all-time peak. Investors appear to be positioning for looser financial conditions and currency instability, rather than a defensive slowdown.

Expert outlook

Most analysts still view Bitcoin’s broader trend as constructive, but the character of the rally is increasingly being questioned. Without renewed US spot inflows, gains may struggle to sustain themselves, even if global liquidity continues to improve.

Some strategists argue that progress on the Clarity Act could unlock sidelined US capital, acting as a catalyst for a push toward new record highs. Until that happens, the market remains exposed to pullbacks driven by leverage unwinds rather than shifts in long-term fundamentals. Bitcoin may be moving higher, but its most influential buyer base has yet to fully engage.

Key takeaway

Bitcoin’s climb above $95,000 reflects a favourable macro backdrop and strong global risk appetite, but it stops short of confirming a clean breakout. Weak US demand leaves the rally reliant on offshore flows and leverage, rather than conviction. Whether this move evolves into a launchpad for new highs or slips back into consolidation will depend on regulation, spot inflows, and how the market absorbs rising leverage. The most important signal to watch is not price action, but participation.

Bitcoin technical outlook

Bitcoin is attempting to rebuild bullish momentum after successfully holding above the $84,700 support area, with price now pressing back toward the $95,000 region. The rebound has driven RSI sharply higher toward overbought territory, signalling strong short-term momentum but also increasing the risk of near-term profit-taking.

From a structural perspective, the recovery remains intact as long as BTC holds above $84,700. On the upside, resistance is likely around $104,000, followed by $114,000 and $126,000. A sustained move above current levels would strengthen the bullish case, while a failure to hold gains would suggest Bitcoin remains range-bound rather than entering a renewed uptrend.