Bitcoin Price Rebound Stalls at 4% Amid Rate-Cut Concerns — What’s Next?

Bitcoin's latest price recovery has faced significant challenges. After reaching a low of around $85,970, the cryptocurrency managed to bounce back by just 4% before stabilizing near $89,380. This movement occurred despite recent ETF news and evidence of technical stabilizing.

Key Takeaways

Bitcoin's recent price rebound was weak, only reaching a 4% increase before stalling.
Rate-cut expectations are low ahead of the Federal Reserve decision, creating market caution.
Despite stagnant prices, large Bitcoin holders are accumulating more, indicating long-term confidence.
Key resistance levels to watch are $89,380 and $90,830, while strong support is found at $84,400.
The future momentum of Bitcoin's price is contingent upon overcoming macroeconomic challenges and resistance levels.

The challenge here lies in the timing. With almost no optimism for interest rate cuts ahead of the Federal Reserve’s decision, overall market caution is overshadowing brief bullish signs. Currently, Bitcoin is trading flat across various timeframes, and the market is eagerly anticipating a definitive trigger for movement.

The Impact of Market Sentiment: Why ETF News Wasn't Enough

On the daily chart, a hidden bullish divergence was observed between December 18 and January 25. During this period, Bitcoin's price set a higher low while the Relative Strength Index (RSI) recorded a lower low. The RSI is an important indicator of momentum strength; when it weakens while the price holds steady, it often indicates potential for a price recovery. This signal did prompt a bounce, but it was short-lived, stopping at approximately 4% and peaking around $89,380 before sellers returned to the market.

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This subdued response is noteworthy. Simultaneously, between January 25 and January 26, optimism surged with BlackRock’s announcement about its Bitcoin premium-income ETF filing. Typically, such ETF news helps to uplift prices, but this time, that was not the case.

BlackRock recently filed the official S-1 for its new iShares Bitcoin Premium Income ETF, although details on fees or a ticker symbol are still pending. The strategy involves "tracking the performance of Bitcoin’s price while providing premium income through an actively managed strategy that includes selling call options."

The missing piece seems to be macroeconomic support. According to Polymarket, there is a 99% chance that there will be no rate changes announced in the upcoming FOMC meeting. With the absence of rate cut hopes, liquidity expectations are tight, which limits any follow-through from positive technical signals. Simply put, while the RSI indicated a potential bounce for Bitcoin, the prevailing rate-cut sentiment dampened that chance.

Whale Accumulation: A Sign of Long-Term Conviction

In contrast to the stagnant price action, large Bitcoin holders are taking a different approach. Wallets containing between 1,000 to 10,000 BTC (often termed smaller whales) have increased their balances from approximately 4.28 million BTC to 4.29 million BTC since January 21. Mid-sized holders with 10,000 to 100,000 BTC have also raised their holdings from around 2.19 million to about 2.20 million BTC. The largest group, wallets holding between 100,000 and 1 million BTC, have added even more aggressively, increasing from 664,000 BTC to around 672,000 BTC by January 28.

Overall, these groups combined took on roughly 18,000 BTC, worth about $1.6 billion at current prices.

This trend indicates a commitment to long-term holding rather than short-term trading. However, conviction requires more than just belief; the cost-basis distribution heatmap reveals the intensity of this struggle.

A significant cluster of short-term supply exists between $90,160 and $90,590, holding around 176,000 BTC. This area has acted as a sell wall, meaning that until either the price or the level of accumulation surpasses it, upward movement is likely constrained. Currently, whale absorption is not substantial enough to break through this resistance.

On the downside, support appears stronger. Between $84,440 and $84,840, nearly 395,000 BTC serves as a cost basis, creating a firm downside buffer. This situation explains why recent sell-offs have stabilized above these price levels.

While whales are indeed buying, they need Bitcoin's price to break above $90,590 to shift the current momentum.

Key Bitcoin Price Levels: The Key Breakpoints

Bitcoin's price currently hovers between consistent buying from whales and ongoing macroeconomic hesitation.

On the upside, the first significant resistance lies at $89,380, which marks the level where the most recent rebound lost momentum. Beyond that, $90,830 becomes the critical breakout point. This specific price level has repeatedly rejected attempts to break since January 21 and corresponds with the previously mentioned cost-basis sell wall. A daily close above this point would indicate that buying demand is absorbing selling pressure.

If that occurs, the next target on the upside would be around $97,190, which is where past resistance clusters are evident.

On the downside, risks remain manageable as long as Bitcoin maintains a price above $84,400. This area aligns with the largest cost-basis support and represents the threshold where long-term holders have significant exposure. Should the price close below this, it could weaken the current accumulation narrative and reopen downward risks.

Until the macroeconomic landscape changes or the $90,830 barrier is breached, Bitcoin’s rebound is expected to remain limited.