Market Overview
Bitcoin started the first week of 2025 with notable price action. According to reliable data:
- January 2, 2025: $94,384.18
- January 3, 2025: $96,852.15
- January 4, 2025: $98,084.34
- January 5, 2025: $98,256.74
The cryptocurrency opened the year at $94,384.18 on January 2 (markets were closed on January 1) and climbed steadily higher throughout the week. By January 5, Bitcoin had settled at $98,256.74, representing a 4.1% gain over the 4-day period.
Key Price Levels and Support/Resistance
The $95,000 mark acted as a key psychological level, initially providing resistance before turning into support. Other key levels to watch include:
- Support: $94,000, $95,000, $96,000
- Resistance: $98,500, $99,000, $100,000
A decisive break above or below these levels could signal the next directional move for Bitcoin.
Technical Indicators and Chart Patterns
The daily chart shows Bitcoin forming a potential rising wedge pattern, which could signal a short-term pullback. The Relative Strength Index (RSI) reached overbought levels above 70 before cooling off, currently sitting at 56.04. The Moving Average Convergence Divergence (MACD) histogram has started to decline, suggesting waning bullish momentum.
On-chain data from Glassnode indicates that Bitcoin’s realized market cap reached $842.7 billion in January, continuing to grow. This metric, calculated based on the price at which each Bitcoin was last moved on-chain, suggests that for Bitcoin’s price to sustain further growth, additional capital inflows may be required.
Market Sentiment and Social Media Analysis
Social media sentiment remains overwhelmingly bullish, with Bitcoin-related mentions on Twitter reaching all-time highs. However, the Fear and Greed Index has entered “Extreme Greed” territory, often a contrarian indicator suggesting caution.
Macroeconomic Factors and News Events
The re-election of Donald Trump in November 2024 has fueled expectations of crypto-friendly policies, contributing to Bitcoin’s recent surge. However, regulatory uncertainty remains as the new administration’s specific stance on cryptocurrencies is yet to be clarified.
Trading Volume and Liquidity
Spot trading volumes have remained robust since Q4 2024, driven by the US presidential election and renewed interest in cryptocurrencies. Crypto.com Exchange led spot trading market share at 38.5% among USD-supported exchanges. However, perpetual futures open interest has declined across major cryptocurrencies, with Bitcoin seeing an 11.1% drop, indicating reduced appetite for leveraged trading.
Short-term Price Predictions
Given the recent pullback from all-time highs and cooling technical indicators, Bitcoin may consolidate in the $97,000-$105,000 range in the coming days. A break above $108,250 could target the next psychological level at $110,000, while a drop below $97,000 might see a retest of the $94,000 support.
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