Bitcoin (BTC) experienced a remarkable surge on Friday, the 3rd of January, reaching nearly $99,000, driven by a resurgence in demand from the United States. This surge was corroborated by the Coinbase Premium Index, which had recently hit a low not seen in the past year due to a more cautious approach taken by U.S. retail and institutional investors over the holiday period.
The index has also managed to surpass the crucial 14-day Simple Moving Average (SMA) for the first time in roughly a month. CryptoQuant analyst Burak Kesmeci pointed out that this indicated a stronger presence of U.S. buyers in the market.
“Whenever the Coinbase Premium Index rises above the SMA14, indicating dominance of Bitcoin buyers, it signifies the resurgence of U.S.-based buyers in the market,” Kesmeci stated.
Huge Daily Inflows of $908 Million into Bitcoin ETFs
A noticeable trend in the U.S. Bitcoin exchange-traded funds (ETFs) landscape was the significant daily net inflows of $908 million recorded on Friday, marking a peak for the month.
Even BlackRock’s IBIT, which had experienced outflows at the beginning of the year, witnessed inflows of $253 million on Friday.
Leading the demand was Fidelity’s FBTC with $357 million, followed by Ark Invest’s ARKB with $222 million inflows. This collective influx signified a resurgence in institutional interest and contributed to Bitcoin’s steady climb towards $98,900.
The ongoing recovery was also fueled by a search for liquidity, as a substantial number of short positions were identified at the $98,000 level earlier in the week. Presently, the upper liquidity is clustered between $99,000 and $100,000.
Conversely, lower liquidity areas (indicated by bright yellow zones) are observed at $97,200, $96,000, and $95,000.
With liquidity seeming to be more concentrated on the lower end of the price spectrum currently, a potential decline towards the $97,000 to $95,000 range cannot be discounted.
Furthermore, analysis from the liquidation heatmap suggests that Bitcoin might enter a price corridor ranging from $96,000 to $100,000 in the near term.
Nevertheless, it remains uncertain whether the robust demand for Bitcoin ETFs will catalyze a bullish breakout above the $100,000 threshold.