Bitcoin Displays Early Strength as Analysts Grow More Hopeful

Bitcoin is showing initial signs of stability as the price fluctuates. Although trading remains uneven due to various external factors, analysts express a cautious optimism about the cryptocurrency's next moves.

Key Takeaways:

Bitcoin has shown signs of early stability, although the overall market mood is still uncertain.
Spot trading volume has increased, indicating reduced sell-side pressure.
A recent dip in price led to significant liquidations in the futures markets.
Institutional investment appears to be increasing as Bitcoin is viewed as a hedge against economic instability.

Bitcoin

Market Signals Point to Current Stability

Reports from Glassnode indicate that Bitcoin's spot trading volume has gradually increased, and the net buy-sell balance has shifted above typical upper limits. This change suggests there's less pressure to sell, though demand remains inconsistent. As the market begins to recover from profit-taking in late 2025, long-term holders are becoming less inclined to sell during price rallies. This behavior contributes to a market that is consolidating instead of experiencing widespread declines.

Futures Market Pressure and Price Retests

Recently, Bitcoin dropped by 3.2% from its peak, leading to a retest of the $92,000 level, which surprised many investors. This movement resulted in around $215 million in liquidated leveraged futures positions, raising concerns about potential further declines.

Simultaneously, weak trading activity in the derivatives market indicates a waning appetite for speculation. Such conditions have made it difficult for Bitcoin to function as a reliable hedge in the current environment. The situation worsened following US President Donald Trump’s announcement of new tariffs on Europe, pushing many traders away from riskier assets.

Analysts from Swissblock highlighted a decline in both network growth and liquidity, drawing parallels to the conditions seen in 2022. At that time, low liquidity and stagnant growth led to prolonged consolidation, but both metrics eventually surged back, igniting a significant price rally.

"Network growth has hit lows not seen since 2022, while liquidity continues to drain. Back in 2022, similar network levels triggered a BTC consolidation phase as network growth began to recover."
— Swissblock (@swissblock__) January 19, 2026

Analysts note that institutional flows into Bitcoin-themed ETFs indicate that institutions are taking advantage of price pullbacks, and long-term holders are not rushing to liquidate their positions. With gold prices also crossing the $4,650 mark, driven partly by softer growth indicators from China, some investors are starting to view Bitcoin as a long-term hedge instead of a short-term trading option.

BTCUSD trading at $90,947 on the 24-hour chart: TradingView

Overall, current trends suggest a gradual market rebuild rather than a vigorous breakout. While buy-side dynamics are improving, they are not yet robust enough to signal a new upward trend. Market volatility continues to be prominent, and geopolitical events or policy shifts could contribute to amplified price fluctuations.

For the time being, the Bitcoin market appears to be stabilizing while remaining cautious. Further improvements in liquidity and a clearer commitment from institutional investors will be necessary to transform this phase of consolidation into a significant price advance.

Featured image from Gemini, chart from TradingView