BTC against the US dollar surges then pulls back, with the Federal Reserve minutes becoming a key turning point? "Super bullish" undercurrents brewing

First Week of 2026 Market Rhythm: Short-term Volatility Struggles to Break 90,000 Level

Entering the first week of 2026, Bitcoin against the US dollar continues to fluctuate at high levels, currently hovering around $93,810. After multiple attempts to breach the $90,000 mark last week, although ultimately failing to stabilize above it, the highest point this week reached $94,800, indicating that bulls are still vying for this psychological level.

Meanwhile, Ethereum performs relatively strongly, trading at $3,240, with a 24-hour increase of 2.18%, and daily trading ranges between $92,420 and $94,800. Market participants note that the low liquidity environment at year-end is gradually improving, but in the short term, prices remain susceptible to the impact of large options expirations.

Structural Changes During Liquidity Restoration

Following a record-breaking options settlement last Friday, significant changes have occurred in market institutional structures. According to QCP Capital analysis, open interest has fallen sharply by nearly 50%, indicating that many traders have adopted a cautious wait-and-see approach after completing large-scale settlements. This structural shift has directly affected price momentum.

Specifically, before options expiration, market makers were in a long gamma position, which helped amplify upward momentum; but after expiration, they adjusted to a short gamma stance. When prices rise, they need to sell spot Bitcoin to hedge, creating natural selling pressure. This explains why, despite repeated attempts by bulls to push higher, Bitcoin against USD still struggles to break through key integer levels effectively.

In contrast, US stocks weakened overall on Monday, with US Treasury yields pulling back, reducing the enthusiasm for risk assets. Rob Haworth, a US bank strategist, stated that in a low-volume environment, the market is experiencing a typical technical reversal adjustment.

Capital Flows Diverge: Corporate Buying Resilience vs. Institutional Net Outflows

Corporate holdings remain resilient. Strategy increased its Bitcoin holdings by 1,229 BTC, worth $108.8 million, at an average cost of $88,568, raising its total holdings to 672,497 BTC from December 22 to 28. This capital came from its ATM stock issuance program, reflecting institutional commitment to long-term Bitcoin allocation.

However, overall capital flows show the opposite trend. CoinShares data indicates that last week, digital asset investment products saw outflows totaling $446 million, with Bitcoin products outflowing $443 million and Ethereum products outflowing $59.5 million. This suggests that while some institutions are increasing their positions against the trend, there is still capital withdrawal pressure at the market level.

Notably, XRP and Solana products recorded net inflows, indicating selective allocation by investors rather than outright bearish sentiment. In interbank financing, the New York Fed data shows banks borrowed $25.95 billion through standing repo facilities on Monday, a rise that typically signals liquidity tightness at quarter-end and year-end.

Technical Breakthrough Path Becomes Clearer

Bitcoin Magazine analysts point out that Bitcoin remains trapped within an expanding wedge pattern, but multiple rejections at lower prices suggest downward momentum is weakening. To regain control, bulls need to first break above $91,400 and then establish a firm footing above $94,000.

If the weekly close can be above $94,000, it could trigger further upward space, targeting $101,000 and even $108,000, though significant resistance zones will be encountered along the way.

Conversely, $84,000 is a critical support level. If broken, prices could rapidly decline to the $72,000–$68,000 range; breaking below $68,000 would significantly increase the risk of deeper retracement.

2026 Outlook: Bulls and Bears in Fierce Confrontation

Market opinions on Bitcoin’s trajectory in the new year are sharply divided. The bullish camp remains strong: Standard Chartered predicts Bitcoin will break $500,000 before 2030, driven by ETF demand and corporate accumulation; Ark Invest founder Cathie Wood also projects a pessimistic scenario of $500,000 by 2030, with an optimistic scenario reaching as high as $1.2 million; Strategy CEO Michael Saylor presents an extreme path, estimating Bitcoin could reach $1.3 million in 10 years and $17 million in 20 years.

These “super bulls” generally believe Bitcoin will gradually evolve into an institutional asset, serving as “digital gold” and an inflation hedge.

Bearish views are also prevalent. Bloomberg analyst Mike McGlone has expressed the possibility of Bitcoin falling back to $10,000 in extreme scenarios. This pessimism mainly stems from concerns over capital competition—current global asset allocation faces the reality of “resource scarcity,” with cryptocurrencies competing with AI industries, precious metals, and other investment sectors for risk capital.

In 2025, precious metals performed notably: gold rose approximately 60% for the year, silver surged 150%, attracting significant capital inflows amid central bank buying, industrial demand, and safe-haven needs. This asset rotation further highlights the market’s volatile sentiment.

FOMC Minutes Will Be a Key Turning Point

Looking ahead, the release of the Federal Reserve’s meeting minutes will be an important reference. Investors are closely watching the Fed’s policy guidance on the interest rate cut path in 2026 and whether year-end liquidity pressures will spill over into risk assets including cryptocurrencies.

John Glover (former Barclays Managing Director, now Chief Investment Officer at crypto lending platform Ledn), a well-known bullish advocate, believes Bitcoin may show a “sideways to slight downward” trend in the short term, gradually increasing long positions within the $71,000–$84,000 range. He views this as part of Elliott Wave’s fourth wave correction, expecting that once a bottom is established in Q1 or Q2 2026, a rebound targeting $145,000–$160,000 will begin. He also emphasizes that if Bitcoin closes below $69,000, a correction would be necessary, but the probability of this happening is relatively low.

Overall, although Bitcoin is significantly below its October all-time high of $126,080, market sentiment and expectations are rapidly changing. If the economy remains resilient and liquidity conditions continue to improve, risk assets could see a more favorable allocation environment; however, macro shocks could cause renewed high volatility or deep retracements. Short-term traders should focus on Fed policy signals and large options expiration rhythms, while long-term holders need to remain alert to valuation and capital competition shifts.