Bitcoin breaks through 96,000 in one night! Reaching a 2-month high, what bullish factor caused the big guy to soar?

Bitcoin breaks through $96,000, with short positions liquidated for approximately $600 million. What is the reason for Bitcoin’s rise today? Comprehensive foreign media reports tell you the reason, and is there still a chance to challenge the $100,000 mark in the future?

Bitcoin Breaks $96K, Short Liquidations Reach About $600M

Bitcoin ($BTC) suddenly surged early Wednesday, rising to $96,495 at one point, hitting a two-month high, and breaking through the market-observed key resistance level of $94,500.

At the same time, CoinGlass data shows that in the past 24 hours, the crypto perpetual contract market experienced liquidations totaling $680 million, with short positions (sell orders) losing $594 million.

What is the reason for Bitcoin’s rise?

Regarding the reasons for Bitcoin’s surge, many foreign media outlets mentioned the U.S. Consumer Price Index (CPI) released last night in December. The data shows that the U.S. December CPI increased by 2.7% year-over-year, and core CPI was 2.6%, all in line with or slightly below market expectations.

Although December’s CPI indicates inflation remains above the Federal Reserve’s (Fed) 2% target, it did not worsen further. CME FedWatch data shows that the market generally expects the Federal Reserve to keep interest rates unchanged at the January meeting, with the possibility of rate cuts later this year.

Image source: FedWatch market generally expects the Federal Reserve to keep interest rates unchanged at the January meeting, with the possibility of rate cuts later this year

In addition to economic data, Ryan Rasmussen, Head of Research at Bitwise, also stated that the unstable global political and economic environment has become a catalyst for Bitcoin, including the collapse of the Iranian currency and the political and economic situation in Venezuela. Moreover, the U.S. Department of Justice has recently launched an investigation into Fed Chair Jerome Powell, which is also seen as a variable affecting market sentiment.

Abra CEO Bill Barhydt believes that the market expects global liquidity to expand significantly this year, and government bond purchases and potential fiscal stimulus measures are closely related to Bitcoin’s price movements.

Retail Investors Have Not Rejoined, ETF Capital Flows Are a Concern

Although Bitcoin has rarely surged so strongly, some analysts remain cautious.

Crypto analyst Darkfost pointed out that Bitcoin spot ETF has recently experienced the largest liquidity withdrawal in history, with over $6 billion flowing out since reaching a record high in October last year, indicating a weakening of institutional momentum.

Furthermore, the market currently lacks retail investor participation. Data from CryptoQuant shows that demand from small investors (purchasing between $0 and $10,000) is at an extremely low level, contrasting sharply with the scene during the bull market when retail investors flocked in.

Image source: IT_TECH_PL CryptoQuant data shows that demand from small investors (purchasing between $0 and $10,000) is at an extremely low level

XWIN Research pointed out that the net fund flow on exchanges remains low, indicating that investors are currently adopting a wait-and-see attitude, not aggressively chasing highs or taking profits.

Market commentator CryptoGodJohn emphasized that investors should pay attention to Coinbase’s premium index; before this indicator turns positive, a structural bullish reversal in the market is unlikely.

Future Outlook: $94,500 as a New Defense Line, Targeting $100K

Looking ahead, Oliver Knight, Data Director at CoinDesk, stated that Bitcoin, after breaking through $94,500, could aim for $99,000 if it can hold that level, with a chance to challenge $100,000 in the first quarter.

However, if Bitcoin fails to hold the $94,500 support, it may retreat to the $85,000 to $94,500 range for consolidation.

This content is summarized by Crypto Agent from various sources, reviewed and edited by “Crypto City.” It is still in the training phase and may contain logical biases or informational errors. The content is for reference only and should not be considered investment advice.