Bitcoin Price Nears Short-Term Cost Line, Market Volatility to Determine Future Direction

Bitcoin Nears Critical Cost Zone

On January 17, CryptoQuant analyst Axel noted that Bitcoin's current price is approaching the average acquisition cost of short-term holders, with a narrow 4% gap remaining.

Market Enters Crucial Decision Phase

Analysts believe the market is in a decision-making phase rather than a bearish breakdown. Historically, price proximity to cost benchmarks has been associated with increased volatility, creating reaction zones that can either extend trends or spark reversals.

Two Potential Scenarios for Short-Term Direction

• If price stabilizes above $100,000 and short-term holders move into profit, the market sentiment could turn bullish.
• Conversely, a drop below $89,500, pushing the discount rate back into double digits, might trigger significant selling pressure.

This analysis suggests that Bitcoin's near-term trajectory will depend on how the market navigates this critical support and resistance area.