Bitcoin rose towards the upper bounds of its weekly trading range between $86,979.26 – $90,064 today, as subtle nods of risk-on sentiment returned across the market.
Investors have begun aggressively buying the dip to start the new year, shaking off the stagnation that characterised the final weeks of December.
Over the past 24 hours, the total crypto market cap regained its footing above the psychological $3 trillion mark, having rallied roughly 2% to $3.12 trillion at press time.
Market sentiment showed signs of relief as well, with the Crypto Fear & Greed Index climbing 8 points to 36.
While this still sits in “Fear” territory, it marks a significant move out of the Extreme Fear doldrums that persisted throughout the holiday season.
Altcoins were the biggest beneficiaries of this liquidity injection, with meme coins stealing the show throughout the day.
Led by Pepe Coin (PEPE), which saw double-digit gains, the sector outperformed the broader market.
Other major meme assets, including Dogecoin (DOGE) and Shiba Inu (SHIB), were also trading firmly in the green at the time of publication, fueled by a renewed appetite for high-beta plays.
Why is Bitcoin price and crypto market up today?
Bitcoin and the overall crypto market’s rally today has been driven by a combination of seasonal trends and a resurgence in global risk appetite.
One of the clearest factors at play is the “January Effect,” as investors who closed out loss-heavy positions in December for tax purposes are now redeploying capital into the market.
This new-year reset has historically sparked inflows, but it’s been especially pronounced this time given the steep end-of-year selloffs.
Bitcoin price, for instance, had pulled back nearly 30% from its October peak of $126,000, and many viewed the $85,000 to $87,000 zone as a compelling long-term support range.
Today’s move suggests those dip-buying efforts are now materializing with more conviction, aided by whale activity.
On-chain data over the past two days has shown a notable uptick in large-holder accumulation, adding weight behind the bounce.
At the same time, open interest in futures has risen more than 2%, topping $130 billion, which is a clear nod that leveraged traders are entering the market with bullish bets.
This kind of futures-led growth alongside spot price movement tends to confirm underlying momentum.
Beyond the crypto-native catalysts, global risk appetite has also returned.
Equity futures for the Nasdaq and S&P 500 have pointed to a positive 2026 open, as traders begin to price in the possibility of Federal Reserve rate cuts by March.
The ongoing wave of IPOs and improving macro outlook have pulled traditional investors back into high-growth sectors, and crypto often sits high on that list when risk sentiment turns favorable.
There’s also a structural tailwind from regulatory clarity that began to take shape late last year.
With the GENIUS Act setting clearer guidelines for digital assets and stablecoin frameworks becoming more predictable, institutional participants have more confidence navigating the space.
This is already playing out in spot ETF flows, where selling pressure in both Bitcoin and Ethereum has begun to subside.
Even meme coins have helped drive sentiment, as traders rotate into riskier assets in search of higher short-term upside.
The rally across tokens like PEPE, DOGE, and SHIB has added to the sense that capital is flowing more freely again.
What’s next for Bitcoin price?
For Bitcoin bulls, reclaiming the psychological support level at $90,000 would be a strong validation point that could open the door to further upside.
Since mid-December, this zone has acted as a key ceiling, with each rally attempt falling short of a clean break.
A decisive push above it could reset the narrative and give traders confidence to begin positioning for a potential return to six-figure territory in the months ahead.
Per the 24-hour liquidation heatmap, Bitcoin’s latest rally has clearly forced a large wave of short liquidations, particularly clustered near the $88,000 to $90,000 range.
See below:
Bitcoin 24-hour liquidation heatmap. Source: Coinglass.
The visual density in these upper bands, coupled with real-time data showing $271.65 million in total liquidations, of which $217.82 million were shorts, points to how this move has caught bearish traders off guard.
Ethereum bore the brunt with $29.73 million in liquidations, followed by Bitcoin at $23.97 million, highlighting the scale of pain for leveraged shorts across majors.
At the same time, the BTC liquidation heatmap suggests that if the price can close and hold above $90,000, there is a thin layer of resistance in the immediate range, with fewer liquidation clusters between $91,000 and $94,000.
This opens a clean short-term path for bulls to test higher territory, particularly if spot bids continue to rise and ETF inflows stabilise.
On the downside, the chart shows a heavy liquidation build-up just below $88,000, followed by more intense bands near $86,000 and $84,500.
This area is also where a new CME futures gap has emerged between roughly $87,800 and $88,000, a zone many traders are now watching closely as a potential downside magnet.
CME gaps have a long track record of attracting price action, and with the rally unfolding into the weekend, some expect Bitcoin to drift back toward this region before attempting any sustained move higher next week.
Market participants have already flagged this risk, noting that weekend trading conditions often produce choppier price action and additional gaps that can complicate early-week structure.
“Good one to keep an eye on in the week ahead,” trading account Daan Crypto Trades wrote on X, adding that with the market heading into the weekend, traders could see a few gaps and a messier chart to start the year.
If Bitcoin does revisit the $88,000 area, the dense liquidation clusters below could provide short-term support as shorts are forced to cover and dip buyers step in once again.
A deeper pullback toward $86,000 or even $84,500 would likely test broader market conviction, but those zones also align with strong liquidation liquidity that could help cushion downside moves.
For now, the near-term outlook hinges on whether bulls can maintain pressure above $90,000.
At press time, Bitcoin price was trading at $89,598, holding on to gains of roughly 2% on the day.
Top altcoin gainers for the day
The altcoin market cap rose 3% to nearly $1.36 trillion earlier in the day before settling at $1.34 trillion at press time.
Ethereum (ETH), the leading altcoin by market cap, rose 3.3% over the day, recovering back above $3,000, and was perched at $3,075 when writing.
Other large-cap altcoins such as BNB (BNB), XRP (XRP), and Solana (SOL) saw similar gains between 2-3% respectively.
Nearly all of the top 100 altcoins in terms of market capitalization were in the green. Sector-wise, the meme coin market saw some of the leading gainers of the day as the total tally of all combined went up 12% over the past 24 hours.
Among them were Pepe (PEPE), outpacing the rest with gains of 32%, largely boosted by improved community sentiment after a well-followed trader who previously predicted the memecoin move to billions when it was trading at $600k, made a fresh prediction that it would go up by as much as $69 billion by the end of this year.
As Pepe rallied, momentum quickly spilled over into other speculative assets, which are often backed by large cult-like followings that tend to eat into the hype.
Floki (FLOKI) and SPX6900 (SPX) caught the slipstream of Pepe’s rally to post gains of over 17%, respectively.
Other leading memecoins were also hovering in the green at press time.
Source: CoinMarketCap
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