Bitcoin price must consistently close above $109K in the weekly time frame to invalidate short-term bearish sentiments.
The United States has been rushing to add Bitcoin to its recently created sovereign wealth fund.
Bitcoin price closed Tuesday in a bearish mood after being rejected above $102K again in the past two days. The flagship coin slipped over 3% in the past 24 hours to trade about $97,672 on Wednesday, February 5, during the mid-London session. Following the heightened crypto volatility, more than $357 million was liquidated in the past 24 hours, with over $88 million involving BTC.
As a result, the short-term prospect of Bitcoin dropping was further amplified, as the BTC fear and greed index dropped from over 72% earlier this week, denoting extreme greed, to around 54% on Wednesday, suggesting neutral. According to on-chain data analysis from Santiment, Bitcoin’s daily active addresses dropped from over 790K on Tuesday to around 224k earlier today.
BlackRock’s IBIT Leads in Buying Bitcoin Dip
(NYSE: BLK), through its iShares Bitcoin Trust (IBIT), has continued to buy more BTCs, despite the short-term bearish outlook. The behemoth fund manager, with over $11 trillion in AUM, believes in Bitcoin’s ability to hedge against inflation and macroeconomic uncertainty.
BlackRock bought 2,520 Bitcoin
Only 450 were mined pic.twitter.com/PzhLFwC8hf
— Quinten | 048.eth (@QuintenFrancois) February 5, 2025
BlackRock bought 2,520 Bitcoin
Only 450 were mined
— Quinten | 048.eth (@QuintenFrancois)
On Tuesday, BlackRock’s IBIT registered a net cash inflow of about $249 million, thus increasing its net assets to about $57 billion. Meanwhile, the net cash inflows to the US spot BTC ETFs on Tuesday were about $340 million, with none of the issuers registering net cash outflows.
What to Expect from BTC Price Action in Coming Days
Bitcoin price has been trading inside a horizontal channel in the last three months, in preparation for the thrilling phase of the 2025 macro bull run. The flagship coin, with a fully diluted valuation of about $1.94 trillion and a 24-hour average trading volume of about $64 billion, has, however, been trapped in a short-term correction towards the lower border of the horizontal channel.
After retesting a crucial support level above $91.5K, Bitcoin price has been showing more signs of another retest before rebounding in the near future. The short-term bearish sentiment will, however, be invalidated if Bitcoin price, in the four-hour time frame, consistently closes above the falling logarithmic trend and regains the 100 Moving Average (MA) as a support level again.
Market Picture
The mainstream adoption of Bitcoin, led by institutional investors, has now involved nation-states, led by the United States and El Salvador. As Coinspeaker explained, Bitcoin’s long-term prospects were bolstered after US President Donald Trump an Executive Order directing the creation of a sovereign wealth fund spearheaded by the Treasury and Commerce Departments.
Additionally, Trump’s crypto and AI Czar David Sacks in a press conference the commitment of the Trump administration to foster the mainstream adoption of digital assets through clear regulatory frameworks.
With around 3 million Bitcoins available in the free market, through centralized exchanges and mining processes, the rising demand from whale investors will trigger a large-scale rally akin to the 2017 cycle.