The price of Bitcoin (BTC) rose approximately 2.6% in early Asian trading on December 29, climbing above the $90,000 level. This move mirrors the price action seen the day after Christmas, raising questions about whether BTC can achieve a sustained breakout above this key psychological threshold.
Analysts at Singapore-based cryptocurrency analytics firm QCP Capital attribute the choppy price movements to reduced liquidity due to the holiday season. They noted that the recent push above $90,000 was driven more by spot and perpetual option purchases than by futures contract liquidations, suggesting support from renewed institutional demand.
Following the expiration of $26 billion worth of Bitcoin and Ethereum options last Friday, post-expiration positioning shifted. QCP highlighted that Deribit's perpetual option funding rates had risen above 30%, indicating brokerage firms were in a short gamma position during the uptrend. The firm added that a sustained break above $94,000 could increase hedging demand.
Notably, December's $85,000 put options were not renewed, and open interest decreased by roughly 50% after expiration. This signals that downside hedging among options investors has diminished. However, QCP analysts concluded that bullish confidence remains weak as open interest has fallen sharply, with capital sitting idle and the market likely waiting for liquidity to return.
Technical analysis reveals BTC is trading in a compressed environment below the major resistance zone around $95,000. The daily chart shows reduced volatility and overlapping ranges, indicating market indecision. While downside momentum has slowed as price approaches the upper end of a multi-month descending channel, the daily bias remains one of consolidation until a sustained move above $95,000 is achieved.
On-chain sentiment analysis from CryptoQuant shows a shift in participant behavior. Whale-sized spot orders (represented by green dots) are now clustering around the current price range, a contrast to earlier phases of the correction dominated by retail orders. This re-emergence of larger participants during consolidation suggests potential early accumulation, implying downside risk may be decreasing as stronger hands absorb supply.
