Bitcoin's price spike has prompted analysts to warn of possible repeats of past declines following significant upticks.
Trump's Crypto Reserve Fuels Bitcoin Price Rally
Bitcoin’s price surged over the weekend, reaching $95,000 after Donald Trump announced plans for a strategic digital asset reserve, sparking speculation about government involvement in Bitcoin and Ether trading. However, by week's end, Bitcoin retreated to $94,222, forming a doji candle, indicating market indecision.
Will $90K Become Resistance or Support?
Bitcoin’s price action remains fragile, with traders questioning whether $90,000 will act as support or resistance. The sell-off coincided with a 1% drop in the S&P 500 due to China's tariffs against the U.S. Analysts pointed out that Trump's strategic reserve plan requires congressional approval.
Bitcoin Remains in Distribution Mode
Data from Glassnode suggests Bitcoin remains in a distribution phase rather than accumulation. The short-term holder cost basis dropped below 1, indicating challenges in maintaining profitability. Analysts note that the current rally lacks strong institutional support.
Bitcoin's future depends on macroeconomic factors and Trump's upcoming crypto summit on March 7. Traders fear a possible repeat of 2019's scenario where an initial rise was followed by a significant drop.
