Bitcoin analysts explain why BTC could avoid a fall below $90,000.

Bitcoin (BTC) price fell to a new low of $91,055 on January 9, the lowest since December 1. The next psychological support range remains below $90,000 and some market analysts continue to predict a decline below this level.

However, the following four reasons suggest that BTC may avoid a fall below $90,000.

Cryptocurrency fear and greed index falls to lowest level in 3 months

The Cryptocurrency Fear and Greed Index fell from a high of 78 to 50 after the BTC price fell 9% between January 7 and 10. The index, which tracks broad market sentiment, fell to its lowest since October 14.

As Cointelegraph reported, the recent plunge in the index was the biggest decline in years and caused sentiment to shift from ‘greedy’ to ‘neutral’.

Technically, this is a positive development. This is because historically, BTC price has shown a reversal whenever the index falls into neutral or fear territory.

Bitcoin indicators suggest that the “market high” has not yet been reached.

Bitcoin sparked concerns about a bearish trend after failing to sustain positions above $100,000 on January 6.

A series of four liquidation events in two months signaled potential weakness and a liquidity drought, with markets gearing up for another period of correction. However, from a fundamental perspective, Bitcoin has not triggered a bull market peak indicator.

Data from CoinGlass highlighted that the peak crypto asset is yet to retest or surpass previous market high signals. The bull market peak indicator consists of 30 conditions that vary depending on the chart and index, but none of the indicators have recorded previous bull market highs in 2017 and 2021.

Crypto analyst Mikybull hinted that this price decline remains an “opportunity” ahead of the expected uptrend.

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Bitcoin whale buys 34,000 BTC since year-end

Large holders have been actively accumulating Bitcoin since late December, with short-term volatility shaking up the bear market.

Cauê Oliveira, head of research at Blocktrends, noted that institutional investors have amassed more than 34,000 BTC worth $3.2 billion since it fell below $108,000 on December 17. Oliveira added:

“Large players took advantage of the consolidation to open TWAP positions and, with patience, accumulated them just below USD 95,000.”

This means that despite BTC being sold below $100,000 recently, institutional demand remains high. Additionally, verified CryptoQuant analyst MAC.D said it provided an window for accumulation rather than a reason for panic selling while short-term investors were suffering losses. He said:

“Selling your coins at this point could be a very unwise decision.”

Selling $6.5 billion in BTC in 6 trading days seems “impossible.”

One of the major downside catalysts affecting the Bitcoin price over the past two days has been the rumor that the U.S. government is potentially selling over $6.5 billion worth of BTC. In response, cryptocurrency commentator Miya said it may be “impossible” for the government to execute a sale within six trading days.

With President-elect Donald Trump taking office on January 20, Miya emphasized the complexities of selling such a large amount of BTC during an impending major political event. Matters are further complicated by the fact that President Trump has stated that he plans to establish Bitcoin reserves. This means the issue could potentially be a topic of discussion during his formal appointment process.

Simply put, the cryptocurrency enthusiast argued that a Bitcoin reversal is more likely because the market has already priced bearish speculation.

After swinging lows below the previous range on the daily chart, Bitcoin liquidity pools are now chasing an uptrend, as pointed out by Mikybull. There remains a chance that Bitcoin could fall below $90,000, but analysts have predicted a V-shaped recovery is possible.

relevant: Bitcoin speculators panic sell at $92,000 during ‘good time to accumulate’