Bitcoin fluctuated around $87,800 on Wednesday, failing to break the $90,000 level earlier in the week. The market is focused on Thursday’s Federal Reserve minutes for clues on potential rate cuts. QCP pointed out that after options expiration, open interest dropped 50%, and market makers turning short gamma could amplify the rally. Market divergence is extreme: Standard Chartered and Cathie Wood forecast $500,000 by 2030, while analysts warn it could fall to $10,000.
Federal Reserve Minutes as a Key to Bitcoin Breaking $90,000
The Federal Reserve meeting minutes released on Thursday (December 31) will reveal policymakers’ true thoughts on the rate cut path through 2026. Currently, the market expects a 25 basis point rate cut in March, but this expectation is very fragile. If the minutes show increased concerns about inflation rebound or a more optimistic assessment of labor market resilience, the rate cut in March could be delayed until mid-year or canceled altogether. Such a policy shift would severely impact risk assets, and Bitcoin could quickly retest support at $84,000.
Conversely, if the minutes show most members support gradual rate cuts and maintain confidence in a soft landing, market risk appetite will rebound. In this scenario, Bitcoin could challenge $90,000 again and, after breaking through, quickly target the key resistance at $94,000. QCP Capital emphasizes that the market maker’s shift to short gamma means that rising prices will increase hedging demand, creating a positive feedback loop.
The biggest current market issue is liquidity exhaustion. Bitcoin fluctuated between $86,780 and $90,247 on Monday, but trading volume was extremely thin. Year-end holidays led many institutional traders to exit, causing severe market depth shortages. Moderate orders in either direction could cause sharp price swings. This “sharp volatility and lack of trend” characteristic of low liquidity greatly reduces the reliability of technical analysis.
After reaching a historic high of $125,000 in October 2025, Bitcoin has retraced over 30%. This deep correction makes it highly sensitive to liquidity changes and risk sentiment. As the last major macro event of the year, the Fed minutes could be a critical catalyst for Bitcoin’s potential rebound in early 2026. Traders are generally cautious, waiting for the minutes to be released before deciding on their positions.
The Triple Battle for the $90,000 Psychological Level
(Source: CMC)
The $90,000 level has become the most important short-term reference point for Bitcoin trading. On Monday, Bitcoin briefly broke above $90,000 in early trading, reaching a high of $90,247, but momentum quickly faded, closing down 0.4% at $87,129. This marks the third failed attempt to break this level recently, indicating heavy selling pressure above.
Technical analysts point out that there are many historical high-volume zones around $90,000, where trapped positions may take profits or stop-loss when prices return near cost basis. Additionally, $90,000 as an integer level has strong psychological significance, with many traders placing take-profit or stop-loss orders here, creating technical resistance. To truly break through, volume must increase and sustained buying support must appear; short-term spikes in low liquidity environments are unlikely to succeed.
Bitcoin Magazine analysts believe the overall market remains within an expanding wedge pattern, with multiple rejections at lower levels indicating weakening downside momentum. Bulls need to first break resistance at $91,400 and then hold above the more critical $94,000. Achieving a weekly close above $94,000 could open further upside, targeting $101,000 and even $108,000.
On the downside, $84,000 is seen as a key support. If broken, the price could quickly fall to the $72,000–$68,000 zone. Further breakdown below $68,000 would significantly increase the risk of deeper retracement. John Glover, former Barclays managing director and current Chief Investment Officer at Ledn, favors gradually increasing long positions between $71,000 and $84,000, viewing this stage as a Wave 4 correction in Elliott Wave theory. He expects a rebound to $145,000 after establishing a bottom in the first or second quarter of 2026.
Contradictory Signals in Capital Flows
Corporate Buying Continues: MicroStrategy purchased 1,229 BTC between December 22 and 28 for a total of $108,800,000 at an average price of $88,568, holding a total of 672,497 BTC. This steadfast buying indicates long-term institutional confidence remains intact.
ETF Funds Outflow: Data from CoinShares shows digital asset investment products outflowed $446,000,000 last week, with Bitcoin products outflowing $443,000,000. This contrasts with corporate buying and suggests institutional investors are risk-off at year-end.
Selective Allocation Emerges: XRP and Solana-related products saw net inflows during the same period, indicating investors are not fully exiting but engaging in selective allocation. This divergence may signal sector rotation in the crypto market by 2026.
$500,000 in 2030 vs. $10,000 in 2026
Market expectations for Bitcoin’s long-term trajectory are extremely divided. On the bullish side, Standard Chartered predicts a breakthrough to $500,000 by 2030, driven by ETF demand and corporate accumulation. Cathie Wood’s “pessimistic scenario” for 2030 also targets $500,000, while the “optimistic scenario” goes as high as $1,200,000. Michael Saylor presents an extreme path: $1.3 million in 10 years and $17 million in 20 years.
On the bearish side, analysts like Bloomberg’s Mike McGlone believe Bitcoin could plummet to $10,000 within the next year. This extreme pessimism is based on concerns over liquidity tightening and regulatory pressures. Market participants note that Bitcoin must compete for capital with AI industries and precious metals. Gold rose 60% and silver surged 150% in 2025, indicating asset rotation is underway.
This divergence reflects the fundamental valuation dilemma of Bitcoin: lacking cash flow or physical backing, its value depends entirely on market consensus and liquidity environment. Optimists believe institutional adoption and scarcity will drive long-term gains, while pessimists argue current valuations are detached from any rational basis. The Fed minutes may influence short-term sentiment but cannot resolve this fundamental divide.
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