Bitcoin Hits $90K: Is the Bottom Already In?
As the year 2026 kicks off, Bitcoin [BTC] has opened with significant bullish momentum, capturing the attention of traders and investors alike. After six weeks of consolidation, Bitcoin has surged past the key $90K level, leaving many to question whether this marks the true market bottom or if this is simply a bull trap. Let’s dive deeper into the data to uncover what’s fueling Bitcoin’s recent move.
Market Signals Pointing to Optimism
Two major factors are currently shaping Bitcoin’s rally. First, there are consistent inflows into Bitcoin ETFs, coupled with steady whale buying. Many analysts are now dubbing this as “coordinated accumulation.” On paper, this narrative sets the stage for Bitcoin to hold its newly reclaimed level, especially with BTC posting a 2.8% gain since the New Year began.
Supporting this optimistic outlook, data from Lookonchain flagged a highly leveraged trader who went long on Bitcoin with 20x leverage. Entering around $87,000, this trader is sitting on approximately 55% in unrealized gains as of now. Furthermore, January 2nd saw $326 million worth of short positions liquidated—the largest short wipeout seen in a month. This coincides seamlessly with Bitcoin’s push to $90K, tilting market flows in a decisively bullish direction.
A Closer Look at On-Chain Data
Despite the enthusiasm, tracking Bitcoin’s on-chain metrics remains critical for gauging the sustainability of this rally. For example, Bitcoin’s Fear & Greed Index recently increased by 7 points, suggesting the market is leaving the “fear” zone—a traditionally bullish indicator. Additionally, the flipping of BTC’s funding rates into positive territory confirms that market sentiment is favoring a strong upside trend.
However, caution is still warranted. Whale activity tells a slightly different story. According to CryptoQuant data, balances held by major whales are on the decline, even as retail investor interest is on the rise. Similarly, addresses holding between 100 and 1,000 BTC have seen their balances decrease over time. If large-scale holders begin to sell, this could create downward pressure on Bitcoin and expose the market to intensified risks.
Another critical narrative surrounds Bitcoin ETFs. While ETFs provide an entry point for institutional investors, total assets under management (AUM) remain at $67.6 billion, nearing their lowest levels since mid-2025. This might imply that ETFs are not currently serving as a strong support for Bitcoin’s price.
What This Means for Traders
For traders, the key takeaway is to monitor on-chain data and whale movement carefully. While the rally above $90K might feel encouraging, discrepancies in whale behavior and ETF flows cast potential shadows over Bitcoin’s sustainability at these price levels. Is the market set for continued gains, or are we looking at another bull trap? Only time—and vigilant analysis—will tell.
Recommended Product: Track Your Bitcoin Gains with Ledger Nano X
As Bitcoin becomes an increasingly popular asset, safeguarding your funds is vital. We recommend the Ledger Nano X, a highly secure cryptocurrency wallet that provides peace of mind for long-term investors. Get yours today to keep your Bitcoin and other cryptocurrencies safe!
