NAIROBI (CoinChapter.com) — Bitcoin’s price action in January 2025 has sparked debates among analysts and traders, as parallels to previous cycles emerge. The flagship cryptocurrency’s 10% decline so far this month echoes historical patterns from post-halving years.
Bitcoin Drops to $90,000 Amid Market Pressure
Bitcoin’s price dipped below $90,000 earlier this week, marking a 7% loss since the weekend. According to Coin Metrics, the asset traded at $90,413 on Monday morning, down 11% over the past week. The broader crypto market also suffered, with Ether shedding 7% and the CoinDesk 20 Index reflecting a 6% decline.
Bitcoin Dips Below $90K, Slight Recovery Follows. Source: CoinMarketCapMacroeconomic factors appear to be driving this pullback. Strong U.S. payroll data last week spurred a rise in bond yields, strengthening the dollar while exerting downward pressure on Bitcoin and other risk assets.
Additionally, concerns over potential tariff policies from President-elect Donald Trump have unsettled investors.
Market participants had entered the year with optimism, expecting pro-crypto policies from the new Congress and White House to bolster sentiment. However, the recent macroeconomic turbulence has cast doubt on those assumptions, with some analysts predicting a turbulent first quarter for cryptocurrencies.
Historical Trends in Post-Halving Years
Analysts have highlighted that Bitcoin’s January slump aligns with historical patterns observed in previous post-halving years. In January 2021, Bitcoin dropped over 25% before embarking on a 130% rally to an all-time high of $69,000 by November. Similarly, in January 2017, Bitcoin fell 30% before surging 2,400% to $20,000 by year-end.
Crypto analyst Axel Bitblaze noted this recurring trend, stating, “Bitcoin dumping in January has historically been a common occurrence in post-halving years.” Despite the recent downturn, he suggested that such corrections often precede explosive rallies later in the cycle.
Whale Activity and Market Sentiment
Ali Charts reported a 51.6% drop in large Bitcoin transactions over the past month, indicating reduced activity among whales.
Bitcoin Whale Transactions Drop by 51.64%. Source: Ali MartinezMeanwhile, analyst Stockmoney Lizards emphasized that Bitcoin’s current cycle has not yet reached its “hype phase.”
While some anticipate a move to $200,000 by year-end, others warn of potential downside risks. A correction similar to previous cycles could push prices below $70,000, highlighting the uncertainty surrounding Bitcoin’s trajectory.
BTC’s Patterns Hint at Deja Vu Rally or Another Trap
Daan Crypto Trades pointed out the striking similarity between Bitcoin’s recent price action and its behavior in late 2023. The symmetrical patterns have fueled speculation about a potential rebound, with traders debating whether Bitcoin is poised for a rally or further consolidation.
BTC Patterns Mirror Past Trends. Source: Dan Crypto TradesIn contrast, J. Fong observed Bitcoin’s lower Bollinger Band tag on Jan. 9, suggesting a possible bottoming phase. However, he cautioned against premature conclusions, citing the need for stronger confirmation before predicting a sustained recovery.
The coming weeks will likely set the tone for Bitcoin’s performance in 2025. While historical patterns and technical indicators provide a basis for cautious optimism, macroeconomic headwinds and declining whale activity underscore the challenges ahead.
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