Bitcoin (BTC) Price Action Hovers Under $95,000 as Analysts Debate Bull and Bear Case

Bitcoin (BTC) saw significant volatility on January 11, hovering under $95,000 following a “bearish overreaction” to recent US employment data.

Bitcoin (BTC) price hovered around $95,000 on January 11, following a “bearish overreaction” to recent US employment data. The cryptocurrency experienced a rollercoaster ride during the final Wall Street trading session, driven by mixed market reactions to the data, which initially caused a drop towards $92,000 before Bitcoin staged a $2,000 rally.

Bitcoin price faced bearish overreaction after US employment data

According to data from Cointelegraph Markets Pro and TradingView, Bitcoin dipped towards $92,000 after the US employment data was released, only to rebound sharply with a $2,000 hourly candle, reaching new local highs. However, Bitcoin quickly consolidated, returning to familiar short-term ranges.

While the data led to a market-wide sell-off, many analysts suggest that the reaction may have been an overreaction. Charles Edwards, founder of Capriole Investments, shared on social media that the strong employment report could actually signal a longer bull run for Bitcoin. Despite initial bearish sentiment, Edwards believes that strong jobs data gives the Federal Reserve more flexibility to keep interest rates higher for longer, which could ultimately benefit risk assets like Bitcoin.

Broader market context: US employment data and investor expectations

The broader market took a hit as investors adjusted expectations regarding US Federal Reserve interest rate cuts in 2025. The S&P 500 and Nasdaq Composite Index both saw declines of approximately 1.5% on January 10, influenced by a tightening monetary policy outlook.

Edwards pointed out that the latest employment data was the strongest in six months, alleviating fears of a potential bottoming in unemployment. He compared the current market dynamics to the aftermath of the March 2020 COVID-19 crash, where a sharp correction was followed by a significant rebound. He highlighted that, although the short-term reaction seemed bearish, the long-term implications could favor bulls as the economic data gives the Fed room to maintain high rates, supporting risk assets like Bitcoin.

Shifting sentiment and Bitcoin’s critical support levels

Other analysts are watching Bitcoin’s next moves closely. Crypto trader Michaël van de Poppe suggested that the initial response to the employment data has already been priced in, and an upward trend for Bitcoin could be expected in the coming days, especially with low odds of a rate cut at the Fed’s upcoming meeting.

However, not all analysts are optimistic. Popular analytics account Bitcoindata21 warned that if Bitcoin falls below $90,000, it could signal deeper market weakness, potentially dragging the crypto market down by 5-10%. If this happens, a strong recovery will be crucial to avoid a prolonged downtrend.

Bitcoin RSI and market strength

The relative strength index (RSI) for Bitcoin and the overall crypto market is showing signs of stress. Bitcoin’s RSI on the 1-hour chart has been fluctuating, while on the weekly chart, the total crypto market cap is approaching trend channel support. This suggests that Bitcoin and the broader crypto market are testing critical support levels, and investors should watch for signs of a recovery or further downside in the coming days.