Bitcoin Surges Above $90,000
Bitcoin (BTC-USD) jumped past $90,000 on Wednesday. However, some analysts are urging caution, indicating that despite the positive sentiment in the stock market, this increase might not signal a strong recovery.
The S&P 500 (^GSPC) and Nasdaq Composite (^IXIC) are poised for their fourth consecutive day of gains as investors anticipate a rate cut from the Federal Reserve in December. In the meantime, Bitcoin has been steadily rising since it dipped to $81,000 last Friday, its lowest point since April.
Thorsten Slok, chief economist at Apollo Management, noted that although Bitcoin and the Nasdaq usually have a strong correlation, the recent drop in Bitcoin prices has altered that dynamic in recent weeks.
Even with the current rebound, Bitcoin is still about 28% down from its peak of over $126,000 recorded last October.
Strategists from 10X Research based in Singapore mentioned that while the fourth quarter often sees strong performance for Bitcoin, history suggests that these pumps usually require a catalyst.
Market expectations indicate a 25 basis point rate cut in December. Yet, the comments from Fed Chairman Jerome Powell during the press conference following the decision will likely be more influential on crypto prices.
“Bitcoin is particularly sensitive to the Fed’s communication rather than just the act of rate cuts,” 10X Research added. They caution that a December cut might not be inherently positive for Bitcoin, and the chance of a sharp market drop might increase if the Fed opts against cutting rates.
The team also expressed skepticism over whether an anticipated increase in Treasury General Account (TGA) spending could boost the market as spending resumes post-government shutdown.
According to 10X Research, during the last TGA announcement involving about $522 billion, Bitcoin initially fell by around $14,000 (15%), only stabilizing after more spending, with a gap of over two months from February to April 2025. This raises questions about the relationship between TGA and Bitcoin performance, with the note suggesting that TGA dynamics may be less causal and more of a delayed effect.
If a similar lag occurs now, Bitcoin might continue to drop until late January 2026 before any liquidity effects are apparent.
Meanwhile, Compass Point analyst Ed Engel has not identified a definitive bottom for Bitcoin yet. He pointed out that “the hallmark of a bear market is a quick rally followed by significant selling,” and suggested that if Bitcoin rises, short-term resistance might fall between $92,000 and $95,000.
Engel remarked, “While we don’t expect BTC trading to mirror past bear markets, we do foresee accumulation by long-term holders. There needs to be stronger short positions from futures traders for a more positive outlook.” He anticipates that Bitcoin might retest around the $82,000 level and could dip below $80,000, noting that there is considerable support in the $65,000-$70,000 range but also an increased risk of retesting the upper end of that range.
