Bitcoin shines above $105,000 with Trump inauguration

Bitcoin (BTC) is trading green and hovering above $105,000 on Friday after hitting an all-time high of $109588 on Monday. Demand for BTC from large investors rises as US President Donald Trump takes over the Oval Office. Moreover, on Thursday, Trump signed an executive order that includes working towards developing a national inventory of digital assets. However, traders should remain cautious, as it can lead to Trump’s upcoming executive orders lead to crypto fluctuations.

Bitcoin price hits all-time high of $109588 as Trump takes over the Oval Office The price of Bitcoin continues to trade green, rising almost 4% this week and hovering above $105,000 on Friday after hitting an all-time high (ATH) of $109588 on Monday.

This week’s rally was mostly driven by US President Donald Trump’s inauguration on Monday, causing BTC to reach an all-time high hours before the event. However, BTC quickly fell 6.68% from its high and closed at $102,260 that day.

Santiment data shows that social media has reached great greed and fear of missing out (FOMO) among Bitcoin traders. The chart below shows the signals on X, Reddit, Telegram, 4Chan, and Farcaster. Historically, prices have moved in the opposite direction to crowd expectations, especially in the short term.

In the case of BTC, the crowd’s mention of higher prices on Monday signaled a sell signal. A similar move occurred in mid-December when the crowd’s mention of higher prices led to a short-term decline in Bitcoin prices. The news has given confidence to the crypto community as Trump has fulfilled his promise to the crypto industry as president of the United States.

Big investors in Bitcoin support its rising price

The demand for Bitcoin from large investors rose with President Trump taking over the Oval Office. According to the report, large investors collected Bitcoin again before President Trump’s inauguration. As shown in the chart below, the monthly growth in the percentage of bitcoin holdings among large investors accelerated from -0.25% on January 14 to +2% on January 17, the highest monthly rate since mid-December. Large Bitcoin holders are the main drivers of Bitcoin demand and price

The report went on to say that the pressure to sell Bitcoin may have fallen sharply after bitcoin holders made profits in December. Bitcoin’s realized profit and loss indicators show that bitcoin holders made daily profits of up to $10 billion as Bitcoin approached $100,000 in December. However, profits generated daily fell to $2-3 billion in January, suggesting that market participants may have mostly finished selling bitcoin.

The report concluded that the growth of overall demand for spot bitcoin has slowed, and the price is not yet to rise again. The apparent demand for Bitcoin continued in the expansion zone. However, the rate of expansion fell from 279K Bitcoin in early December 2024 to 75K this week. Bitcoin demand growth should accelerate again for prices to rise significantly.

Trump’s active participation and support for cryptocurrencies from the US government may create a bullish outlook for Bitcoin prices in the future.

Early Friday, US President Trump said in an interview that he would “prefer not to have to use tariffs on China” but described tariffs as “tremendous force”, after speaking to Chinese President Xi Jinping. BTC is trading slightly above $105,000 at the time of writing.

Bitcoin Challenges amid Trump and Economic News

On Tuesday, BTC resumed its rally after rebounding from the $100,000 support level and rose 3.8%. This continued increase was fueled by Michael Saylor’s post on X, which highlighted that Micro Strategy (MSTR) acquired 11,000 BTC Worth $1.1 billion at an average price of $101191 per bitcoin, the company currently holds 461,000 BTC for $29.3 billion, at an average price of $63,610 per BTC.

Meanwhile, US President Donald Trump announced on Truth Social that he had issued an unconditional pardon to Ross Ulbricht, the founder of the dark web marketplace Silk Road. The news has given confidence to the crypto community as Trump has fulfilled his promise to the crypto industry as president of the United States.

However, Bitcoin failed to maintain the bullish momentum and fell slightly on Wednesday, falling 2.3%, as the US dollar (USD) strengthened after President Trump threatened to raise tariffs of 25% on Canada and Mexico and 10% on China, which will take effect on February 1. He also plans to impose tariffs on Europe after stating that the EU will have to “pay a heavy price” for not buying enough US exports during his election campaign. In addition Trump has threatened to impose “high levels” of sanctions on Russia and tariffs on imports from there if President Vladimir Putin does not reach a compromise to end his war against Ukraine, according to CNBC.

On Thursday, Bitcoin hovered around $103,900 as the U.S. weekly initial jobless claims data came in at 223K for the week ended Jan. 17, slightly above the expected value of 220K. This data may allow the US Federal Reserve (FED) to keep prices low or around the same levels for longer, weakening the US dollar (USD) and supporting risky assets such as stocks and bitcoin.

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