Bitcoin approaches the $95,000 key level, the final test before $100,000

Bitcoin prices continue to rebound, with the latest quote around $93,583, gradually approaching the important resistance zone of $95,000. Over the past 7 days, the total increase has been 7.45%, and 24-hour trading volume has increased by over 30% year-on-year, indicating a clear rise in market participation. However, technical indicators show divergence, with the Sharpe ratio continuing to decline, suggesting that risks and opportunities coexist.

Price Status and Technical Signals

Bitcoin has re-claimed the 10-day and 50-day moving averages, with RSI at 65, indicating moderate momentum. But stochastic and Williams indicators are approaching overbought levels, and Bollinger Bands show the price near the upper band, signaling rising short-term correction risks.

From key levels, Bitcoin currently faces two major resistances:

Support levels are relatively clear. If the price pulls back, $92,000 to $93,000 is the first support, with additional defenses at $90,000 and $88,500 below.

Market Sentiment Turns Optimistic

Recent data shows a shift in institutional attitude. Coinbase premium gap has returned to zero, indicating US institutions are resuming purchases. The cryptocurrency Fear and Greed Index has risen from extreme fear at 29 to 40, reflecting a significant improvement in market risk appetite.

In the prediction market, Polymarket data shows traders are optimistic about recent gains:

• The probability of Bitcoin reaching $100,000 in January has risen to 38%
• The probability of reaching $95,000 is 71%
• The probability of dropping to $90,000 is 40%
• The probability of dropping to $80,000 is 20%

This suggests that market participants are generally bullish on the short-term trend but also recognize considerable downside risk.

Hidden Risk Signals

Despite the price increase, deeper data reveal some concerns. CryptoQuant shows the Sharpe ratio for Bitcoin continues to decline, and the one-year return remains in negative territory. This indicates that the risk-adjusted return efficiency is decreasing. In previous strong bull markets, price and Sharpe ratio tended to rise together, but the current divergence suggests this rally is driven more by short-term funds rather than stable demand.

On-chain structure also hints at underlying issues. Long-term holders remain stable, but short-term traders’ profitability is beginning to be pressured. This structure is typical during high-level consolidation rather than trend breakouts. In derivatives, although open interest is steadily rising, data show funds are mainly rotating rather than aggressively leveraging, indicating relatively rational market participation.

Liquidation Risks and Liquidity Considerations

According to Coinglass data, if Bitcoin breaks through $93,000 and continues upward to $93,000, the liquidation of longs on major centralized exchanges could reach $528 million, potentially pushing prices higher. Conversely, if it falls below $90,000, the total liquidation of shorts could reach $364 million, possibly accelerating a decline. This dual-sided liquidation pressure highlights the current price range as a key focus for the market.

From a macro perspective, global debt expansion and liquidity easing are expected to continue at least until 2027, providing fundamental support for risk assets like Bitcoin. The US spot crypto ETF’s total trading volume has surpassed $2 trillion, with institutional participation steadily increasing.

Summary

Bitcoin has entered a critical decision zone. Whether it can break through $95,000 and test $100,000 depends on the sustained momentum of short-term funds. From a technical standpoint, upside potential exists but risks are also rising; market sentiment is already optimistic; and fundamentals show liquidity support remains, but divergence indicators warrant caution.

Investors need confidence in a stable above $92,000 to $93,000 before expecting further upward movement. In the short term, overbought indicators and fund rotation suggest increased volatility, so caution is advised against high-level pullbacks.