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Bitcoin Drops Below $98K Amid Market Caution and AI Rivalry

Coin WorldMonday, Jan 27, 2025 5:54 pm ET

1min read

Bitcoin Price Dips Below $98,000 Amid Market Caution and Emerging AI Competition

Bitcoin (BTC) price witnessed a sharp decline of 7.13% toward the tail end on Jan. 26 to the early hours on Jan. 27, dropping under $100,000 for the first time since Donald Trump became the 47th US president. Since then, the crypto asset has teased a position above $100,000 as the market contemplated the next directional bias.

There has been a noticeable conflict in market sentiment over the past couple of weeks, with some analysts calling it a market top while others remain optimistic for another leg up. For the better part of the previous week, President Donald Trump’s tight-lipped demeanor on any crypto-related executive orders during the inauguration speech did not sit well with the Bitcoin community.

Axel Adler Jr, a Bitcoin researcher, pointed out that short-term holders took minimal part in the recent BTC sell-off. In an X post, the analyst highlighted that BTC’s short-term holder profit loss to exchanges remained under 2,000 BTC. On the previous seven occasions when BTC dropped by more than 5%, more than 5,000 BTC were moved at a loss on exchanges. The analyst said the recent shake-off did not indicate any “major panic selling in the market.”

In light of that, Joao Wedson, Alphractal founder, also said that buying pressure has swiftly returned after the price dropped under $100,000. However, a significant amount of long positions were compromised. Glassnode, a data analytics platform, said more than $68 million longs were liquidated in 24 hours. The platform added, “The 24-hour SMA of Bitcoin long liquidations reached $2.9M, marking the third-largest long liquidation event in the last three months.”

One particular trend observed with Bitcoin over the past few months is volatile Monday price action which can often determine the weekly low or high before reversing in the opposite direction. This can usually occur when the price moves sharply in low liquidity sessions before reversing in the actual direction once the US market opens. It is important to note that losses can compound later in the week, but over the past eight weeks, BTC

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