Bitcoin Falls Toward $100K as US BTC Reserve Bets Tumble Post Trump Inauguration

Bitcoin (BTC) dropped by over 7% a day after establishing its record high of around $109,360. A disappointing Donald Trump inauguration ceremony drove its losses. As of Jan. 21, it was trading for as low as $100,087 (data from Bitstamp).

The 47th US president signed multiple executive orders after taking the oath on Jan. 20. However, none mentioned crypto, which the broader market had anticipated in the days before the inauguration.

This resulted in a broader decline in the crypto market, with most top-ranking cryptocurrencies—like Bitcoin—underperforming on a 24-hour adjusted timeframe.

For instance, Ethereum’s native token, Ether (ETH), dropped by about 4.5%. XRP (XRP), the top-performing cryptocurrency so far in 2025, also dipped by circa 6.25%.

Solana (SOL), whose blockchain is associated with the recently-launched Trump memecoins—$TRUMP and MELANIA—was one of the worst-performing tokens, dropping by about 12% in the last 24 hours.

$TRUMP and $MELANIA themselves crashed by around 30% and 60%, respectively.

Trump’s Odds of Launching US Bitcoin Reserves Dip

A Polymarket chart tracking the probability of Trump establishing a Bitcoin reserve within his first 100 days revealed a dramatic drop in confidence following his inauguration speech.

The probability among betters fell from over 60% to just 29%, signaling investor disappointment after Trump failed to address cryptocurrencies or blockchain technology in his address.

Market expectations had been high, with many traders anticipating bold policy moves to support Bitcoin, given Trump’s historical interest in financial markets.

Bitcoin Traders Are Eyeing Strong BTC Price Rebound

Bitcoin’s sharp retreat following Trump’s inauguration has prompted hopeful responses from the market’s top analysts. Many have reminded the industry of the cryptocurrency’s growth potential in 2025.

For instance, market analyst Michael van de Poppe was quick to mention how Trump’s administration has $100 million in Ethereum and $47 million in Bitcoin (via Wrapped Bitcoin).

Eric Trump, President Trump’s third child, further revealed that he holds four cryptocurrencies: BTC, ETH, SOL, and SUI.

Additionally, Farside Investors data shows an overall upward trajectory in net capital flows toward Bitcoin-based spot exchange-traded funds in the US. As of Dec. 20, these funds collectively managed assets worth $38.98 billion, a record high.

NEW: 🇺🇸$5.8 trillion AUM Fidelity’s #Bitcoin spot ETF becomes the largest ETF among all of its ETFs🔥🔥 pic.twitter.com/ePuSWrkAaT

— Crypto India (@CryptooIndia) January 20, 2025

Pseudonymous analyst Inmortal Crypto offered a bullish outlook for Bitcoin, citing its current market cycle compared to previous ones.

Historically, Bitcoin’s price has taken an average of 1,064 days to rise from a market bottom to a cycle peak. According to Inmortal Crypto, the current cycle has only spanned 792 days, implying that the market may not have reached its top yet.

In addition, Inmortal Crypto highlights that in past cycles, the duration from halving to the cycle’s peak has averaged 532 days, whereas only 273 days have passed in the current cycle.

A similar trend can be seen in the interval between U.S. elections and Bitcoin’s peak, historically 385 days, compared to just 84 days in this cycle. These metrics suggest that Bitcoin may have significant upside potential if it continues to follow historical patterns.

Key Levels to Watch

Bitcoin’s price action appears to be consolidating within a classic bull flag pattern. The pattern, characterized by a sharp upward move followed by a parallel price range, suggests potential for further upside.

However, Bitcoin has recently faced resistance near $109,000, leading to a pullback toward the flag’s lower trendline, which aligns with the 50-3D exponential moving average (50-3D EMA; the red wave) near $85,000.

This confluence of support could serve as a critical area for bulls to defend.

Historically, the 50-EMA has acted as a strong dynamic support during bullish trends, making its retest a key moment for determining whether Bitcoin can sustain its upward momentum.

A breakdown below this level could invalidate the bull flag, while a bounce may confirm the pattern’s breakout potential.

Conversely, suppose Bitcoin breaks out above the flag’s upper boundary with strong volume. In that case, the pattern’s measured move suggests a potential upside target above $150,000, based on the height of the flagpole projected from the breakout point.