Bitcoin investors who purchased the cryptocurrency in recent months have been holding at a loss since November 2024, with on-chain data showing this condition has continued for eight consecutive weeks.
Analysis from blockchain analytics firm Glassnode indicates that short-term holders, defined as those who bought BTC within the past 155 days, require the price to recover above $98,000 to return to profitability.
The STH-NUPL metric, which tracks this group's net unrealized profit and loss, has stayed negative throughout this period. Glassnode reported the aggregate entry price for these recent investors is $98,300, a level it described as critical for market sentiment.
"Historically, reclaiming and holding above the Short-Term Holder cost basis has marked the transition from corrective phases into more durable uptrends," the firm stated.
The $98,000 level holds additional market significance. According to LongCryptoClub analysis, large option demand has accumulated around the January 30th strikes at $98,000 and $100,000, creating potential for accelerated upside momentum if those levels are breached.
Market makers holding short positions on these calls would need to buy underlying Bitcoin to maintain delta-neutral hedging as prices approach these strikes, potentially amplifying any breakout move.
Bitcoin briefly tested resistance near the 38.2% Fibonacci retracement level formed between November's local low and the all-time high during last week's trading.
The cryptocurrency reached approximately $97,000 before pulling back sharply to $91,800 on Monday morning, triggering $233 million in long liquidations across derivatives markets.
Despite this volatility, the technical structure remains intact with higher highs and higher lows persisting on daily charts.
Hyblock Capital data showed approximately $250 million in net long positions filled near $92,000 during Monday's dip, suggesting institutional buyers viewed the pullback as an accumulation opportunity.
The institutional buyers' accumulation was confirmed by data from CryptoQuant founder Ki Young Ju, who said, "institutional demand for Bitcoin remains strong."
Bitcoin stabilized around $92,000 in Tuesday's Asian session following the initial selloff.
The broader crypto market continues to underperform traditional risk assets amid multiple headwinds converging.
President Trump's renewed tariff threats targeting eight European nations over Greenland negotiations pushed markets into defensive positioning, with crypto experiencing disproportionate weakness.
Speaking with Cryptonews, Farzam Ehsani, CEO of crypto exchange VALR, observed that "while concerns about the US-EU trade war have had the greatest impact on sentiment, other risk assets, including the KOSPI, are trading flat or higher. This suggests that cryptocurrency-specific weakness persists."
Monetary policy expectations compound the challenge. CME FedWatch tools indicate markets aren't pricing the first interest rate cut until June 2026, meaning tight liquidity conditions will persist through the first half of the year.
"This means that monetary policy will remain tight, and the influx of new liquidity needed to form a full fledged bullish cycle is not expected in the coming months," Ehsani explained.
Despite stabilization attempts near $100,000, Bitcoin remains vulnerable to macro shocks.
Monday's selloff occurred during thin weekend liquidity, with elevated leverage positions amplifying the decline into a flash drop.
Total crypto market capitalization fell nearly 3%, while major altcoins, including SOL, DOGE, SUI, and XRP, dropped more than 5% as capital rotated into established safe havens like gold.
Long-term holder distribution has slowed significantly, with realized profits dropping to approximately 12,800 BTC per week, according to Bitfinex, well below earlier cycle peaks.
However, data from CryptoQuant Head of Research Julio Moreno revealed Bitcoin holders began realizing losses for a 30-day period since late December, marking the first sustained loss-taking since October 2023.
Bitfinex analysts noted that "for a more durable rally to take hold, market structure will need to transition into a regime where maturation supply begins to outweigh long-term holder spending."
The cryptocurrency traded calmly near $92,000 on Tuesday despite broader macro turbulence, with dealers framing recent volatility as a leverage reset rather than a fundamental trend reversal.
While consolidation near $92,000 appears to have absorbed immediate selling pressure, the crypto market faces a critical test in the coming sessions as traders await clarity on the Federal Reserve's policy direction and a resolution to escalating trade tensions that have kept institutional capital cautious throughout January.