"Bitcoin Faces Potential Bear Trap Below $95K, But Long-Term Bullish Outlook Remains Strong"
A bear trap is a trading strategy designed to deceive market participants by creating a temporary price dip, typically within a larger, ongoing uptrend. It is a form of controlled selling intended to trick investors into thinking an asset is in decline, only for the price to rebound after the drop. Bitcoin, despite having closed its first-ever monthly close above $100,000, could be facing a potential bear trap, as its price dips below the $95,000 mark in the near future.
On February 2, Bitcoin fell below the psychological threshold of $100,000, marking its first time below this level since January 27. This drop coincides with growing concerns over inflation and broader economic impacts. The decline comes in the wake of import tariffs imposed by President Donald Trump on goods imported from China, Canada, and Mexico, which have sparked inflation worries across the financial markets.
Ryan Lee, the chief analyst at Bitget Research, suggests that the recent decline could signal the start of a larger correction, with Bitcoin potentially falling to $95,000 in the short term. According to Lee, the $95,000 range is a critical support level for Bitcoin, and market dynamics surrounding labor market trends, Federal Reserve policies, and overall market sentiment will play key roles in determining the asset’s next move. Lee pointed out that investors should closely monitor these factors in the coming weeks, as they could influence Bitcoin’s trajectory.
Bitcoin Prediction
In the short term, Bitcoin may have a chance to recover if upcoming labor market data reveals signs of a sluggish economy. The US Bureau of Labor Statistics is set to release the labor market report on February 7, and if the data indicates weakness, it could pave the way for the Federal Reserve to consider rate cuts. According to Lee, a potential rate cut could provide a more favorable environment for Bitcoin, potentially helping its price rebound.
Despite the short-term uncertainty, Bitcoin achieved a significant milestone in January, securing its first-ever monthly close above $100,000. Bitcoin finished January with a close of $102,412, representing a more than 6% increase over its previous record high of $96,441, set in November 2024. This marked a historical achievement for the cryptocurrency, and some analysts believe that the current price dip may simply be part of a bear trap—a temporary setback within a broader uptrend.
While Bitcoin may experience a correction in the near term, its long-term prospects remain strong, especially as the market continues to show interest in spot Bitcoin exchange-traded funds (ETFs). In fact, these ETFs reached a record high of over $125 billion in assets just a little over a year after their debut on January 11, 2024. This suggests that institutional adoption of Bitcoin is continuing to grow.
Looking ahead, many analysts remain optimistic about Bitcoin’s future. Predictions for Bitcoin’s price during the rest of the 2025 market cycle range from $160,000 to potentially even higher, surpassing $180,000. This long-term bullish outlook is driven by increasing institutional interest, growing adoption of Bitcoin as a store of value, and the overall maturation of the cryptocurrency market.
Conclusion
In conclusion, while Bitcoin may be experiencing a temporary price correction or bear trap, its prospects for the remainder of 2025 remain promising. Investors should watch key economic indicators, such as labor market reports and Federal Reserve policy, to gauge the potential direction of Bitcoin’s price. If the broader economic environment remains supportive, Bitcoin could continue its upward trajectory, potentially reaching new all-time highs later this year.
