Bitcoin consolidates below 20-day EMA, deeper pullback after $94K?
2025-01-12
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The price of Bitcoin BTCUSD fell to around $94,000 on Jan. 11 — down by over 8.5% over the past five days from a local high of over $102,000 recorded on Jan. 7.
BTC is currently trading below its 20-day exponential moving average (EMA) — a sign that bears are currently in control. Price has also been consolidating since Dec. 19, 2024.
The Relative Strength Index (RSI) is trending down and is currently at 45, which is neither oversold nor overbought, but has fallen by over 20% since Jan 6.
Industry analysts have warned that Bitcoin and the crypto markets could suffer a correction around President-elect Trump's inauguration on Jan. 20, as traders see it as a sell-the-news event, or promises of pro-crypto legislation are not met.
President-elect Trump's inauguration may trigger sell-off
In a Dec. 17 article, BitMEX co-founder and analyst Arthur Hayes cautioned crypto traders that the inauguration of Donald Trump as President of the United States could trigger a market-wide sell-off.
Hayes wrote that investors would quickly dump crypto and equity positions that were purchased with the expectation of pro-crypto and pro-business policies from the second Trump administration. 
The analyst predicted that once investors realized that policies take a long time to implement and that Trump must pass favorable legislation in one year or less, this would trigger a massive sell-off.
However, Hayes added that he was still bullish on the long-term price of Bitcoin due to macroeconomic factors like ballooning government debt and currency debasement worldwide.
An increase of up to $612 billion dollars in new liquidity injected by the US Federal Reserve could also make up for a potential regulatory disappointment from the Trump administration — helping drive the price of BTC higher during Q1 2025.
Hayes' warning was echoed by CryptoQuant CEO Ki Young Ju in a December 2024 social media post.
Ju argued that Trump's pro-crypto policies will depend on the United States' economic standing and the value of the US dollar.
The CEO said that the US dollar is currently gaining strength as a safe haven asset, used as a store of value worldwide.
Moreover, Trump's rhetoric of strengthening the US dollar and the US in foreign trade makes it improbable that he will establish a Bitcoin strategic reserve, Ju said.
This article does not contain investment advice or recommendations. Every investment and trading move involves risk, and readers should conduct their own research when making a decision.