• Bitcoin price plunged below $92,000 on Thursday, on course to close trading at a 40-day low.
• US authorities approved the sale of 69,370 BTC seized from the Silk Road marketplace.
• Following a 10% price correction in the last 48 hours, BTC bulls have deployed $721 million in leverage to avert a breakdown below $90,000.

Bitcoin price dipped to $91,800 on Thursday, marking its lowest in 43 days, dating back to December 9. Derivatives markets data shows concentrated BTC long positions around the $90,000 mark, as bulls move to halt the downtrend. 

Bitcoin losses hit 10% as markets price in $6.5B sell-off from US Government  

Bitcoin price suffered a sharp decline, dropping over 10% within two days as the market volatility intensified on Thursday.

Investor sentiment, already fragile following hotter-than-expected JOLTs jobs data, faced another bearish shock as news surfaced of an impending $6.5 billion Bitcoin sell-off by the United States (US) Government.

The US Government has reportedly received clearance to liquidate 69,370 BTC seized from the infamous Silk Road marketplace. 

Court documents revealed that Chief US District Judge Richard Seeborg denied a motion to block the forfeiture, allowing the Department of Justice to move forward with selling the crypto haul.

The scale of the sell-off has spooked traders, amplifying bearish headwinds in a week that began on a downtrend.

Bitcoin price action, January 8 2025. | BTCUSDT (Binance)

BTC price reacted swiftly, plunging from $95,060 to $91,800 as shown in the chart above. 

Market speculation is now rife on if the sell-off occurs before President-elect Donald Trump’s inauguration, who has campaigned on a pro-Bitcoin stance. 

Trump’s proposals include leveraging seized funds to establish a national Bitcoin reserve, adding an ironic twist to the gGovernment’s crypto liquidation narrative.

Bulls mount $721 lLeverage to avert $90K breakdown 

Following a 10.5% loss over the past two days, Bitcoin holders are making desperate moves to keep prices from falling below the critical $90,000 threshold.

While overall crypto market sentiment remains bearish, bullish traders are attempting to establish a support wall at this key level.

Coinglass’ Liquidation Map data highlights the total leverage deployed on long and short positions near significant price points.

This metric offers insight into pivotal BTC price support and resistance levels to monitor in the short term.

Bitcoin Liquidation Map | Coinglass

At first glance, the chart shows that short traders currently dominate, with over $3.55 billion in active short positions compared to $1.3 billion in long positions. 

However, a closer look reveals that BTC bulls have concentrated over $721 million in active leverage positions around the $90,000 mark—accounting for nearly 60% of active long BTC futures contracts.

During market dips, large leverage positions near key price levels can prompt traders to make covering spot purchases to avoid liquidation losses.

Essentially, holders of the $721 million in BTC long contracts around $90,000 are now incentivized to make covering spot purchases.

If selling pressure eases, these covering buys could trigger a mild rebound in BTC prices in the coming days.

Bitcoin price forecast: Holding $90,000 support could trigger an early rebound 

Bitcoin price outlook shows signs of a potential reversal as the double bottom pattern at $90,000 signals a possible rebound.

This technical formation, historically known for marking trend reversals, is further validated by the rising BTC trading volume, indicating heightened market participation and buying interest. 

Beyond that, the VWAP (Volume Weighted Average Price) line trending above the current price also indicates buying pressure is building up. 

Bitcoin price forecast | BTCUSD

Conversely, bearish scenarios remain plausible if Bitcoin fails to sustain above the critical $90,000 support level.

The chart reflects dominance by short traders, with significant selling pressure that could drive prices lower.

A breakdown below this level would negate the double bottom’s bullish implications, potentially dragging BTC toward $84,000, where further liquidity may be tested.

For now, the double bottom and increasing volumes provide cautious optimism for a rebound.

A sustained break above $93,217 (VWAP level) could open the path toward $100,000, aligning with the bullish target implied by the double bottom structure.

• Dogecoin price found support at $0.32 on Thursday, having declined 20% in the past four days. 
• Derivative market data shows early rebound signals for DOGE as traders react to Elon Musk’s rumored interest in purchasing British soccer team, Liverpool FC.  
• DOGE Open Interest stabilized above the $3.4 billion market despite the $500 million liquidations tearing through the crypto market on Wednesday.

Dogecoin price stabilized around the $0.32 mark on Thursday, as the market sell-off subsided after 20% losses in 4 days. Market reports suggest Elon Musk’s rumored plan to purchase Liverpool FC could lift DOGE traders’ sentiment. 

DOGE price finds support at $0.32 after 20% losses in less than week

Dogecoin price steadied around $0.32 on Thursday, halting a sharp 20% decline over the last four days.

This stabilization follows a broader market sell-off triggered by hawkish macroeconomic expectation that weighed heavily on the global memecoin market. 

Notably, DOGE price managed to avoid a breakdown below $0.32, as bears extended the weekly time frame losses to 20% mark on Thursday.

DOGE’s rare show of resilience at the $0.32 support level suggests investors appear to be defending this crucial price zone. 

Dogecoin price action | DOGEUSDT (Binance) 

One crucial factor bolstering Dogecoin market sentiment is the speculation surrounding Elon Musk’s rumored plan to acquire Liverpool FC. 

Musk’s historical influence on Dogecoin’s price remains significant, as his business decisions and tweets have often driven retail interest in DOGE.

If confirmed, this development could reinvigorate bullish momentum, with traders anticipating Musk’s involvement to bring DOGE back into the spotlight.

Dogecoin traders maintain $3.4B Open Interest despite market pullback

Dogecoin price resilience around $0.34 shows that the majority of DOGE traders remain reluctant to close out their existing positions.

An indication of this, the Coinglass Open Interest chart below shows the total value of unsettled derivative contracts with the Dogecoin futures market, offering insight into trader engagement and market liquidity. 

Dogecoin Open Interest vs. DOGE price | Source: Coinglass 

The chart above shows that while Dogecoin price fell 20% between Jan 5 and January 9, open interest only declined by 16% during that period, moving from $4.07 billion to $3.4 billion at the time of publication.

When open interest declines at a slower rate than price during a market downturn, strategic traders may interpret it as an early rebound signal for two key reasons. 

First, the slower decline in Open Interest suggests that a significant number of traders are holding onto their positions, anticipating a potential recovery.

Second, it highlights that leveraged traders remain active, possibly setting the stage for a short squeeze if bullish momentum returns.

While market caution persists amid macroeconomic uncertainty, DOGE’s elevated Open Interest signals that traders remain optimistic about its price recovery, amid tailwinds from Elon Musk’s proposed purchase of Liverpool FC. 

Dogecoin Price Forecast: Short Squeeze could spark $0.40 breakout

Dogecoin price action continues to test the $0.318 support level, reflecting cautious sentiment among traders.

The chart reveals that Dogecoin has declined nearly 20% in four days, yet it holds above the 200-day moving average (DMA) at $0.284. 

This suggests that long-term bullish traders may be attempting to establish a price floor, bolstered by its proximity to the VWAP at $0.326, which further aligns with buyer re-entry interest.

Additionally, the narrowing Volume Delta, showing -$271 million, indicates that selling pressure has waned considerably, hinting at a potential rebound.

Dogecoin price forecast | DOGEUSD

In the bullish scenario, Dogecoin could break above the 50-day DMA at $0.378, signaling a recovery toward the $0.40 resistance level.

This rebound would likely be fueled by short-squeeze dynamics, given the sustained Open Interest and active leveraged positions.

However, a decisive close above the VWAP remains a prerequisite for confirming renewed bullish momentum.

Conversely, if Dogecoin fails to maintain support at the 200-day DMA, a further decline to $0.28 becomes plausible.

Increased selling pressure could amplify bearish momentum, invalidating the rebound narrative and signaling further downside risk.
 

Billy Markus, a software developer who collaborated with Jackson Palmer to create the original meme cryptocurrency Dogecoin in 2013, has taken to his X social media account to repost a video extract from a recent speech made in the U.S. Senate by Senator Joni Ernst (IA) from the Republican Party.

While making her point to the Senate, she used a picture of the famous Doge meme overtaking a city. On that canvas, Doge overtook Washington, D.C. Markus shared his half-humorous and half-serious take on this Doge meme demonstration.

Doge meme canvas makes it to U.S. Senate meeting: “Doge is inevitable”

The aforementioned Senator Joni Ernst underscored the importance of the recently created Department of Government Efficiency spearheaded by billionaire entrepreneurs Elon Musk and Vivek Ramaswamy, D.O.G.E, saying that tax dollars must not be wasted. She urged other senators and politicians to join this initiative, stating that “Doge is inevitable.”

The canvas depicts a popular Internet meme, where a Doge dog in the form of a sand-dust cloud is devouring Washington D.C, hinting that D.O.G.E.’s operations will spread around the government city quickly and inevitably.

Billy Markus, also known on social media as Shibetoshi Nakamoto, commented on this tweet, saying: “Pretty funny to see this doge meme IN THE SENATE.”

Markus’s army of followers responded quite enthusiastically to his Doge post, publishing comments about the thing widely associated with Markus’s brainchild making its way into the U.S. Senate: “Doge is the future,” “You’ve really made it now” and “Politicians are catching on.” There was even one proposing that Markus should be voted into the Senate: “Billy for Senate.”

Related

Dogecoin crashes 16% after printing similar rise

In the last week, the largest meme cryptocurrency has demonstrated high volatility movements, as it first skyrocketed by roughly 16% on Jan. 3, plunging by 17.06% over the past two days. Dogecoin shed its massive gains, falling from $0.40 back to $0.32, where it is changing hands at writing time.

Billy Markus highlighted the Dogecoin surge on Jan. 3, publishing a post about it. As for the Bitcoin price crash, which took place on Jan. 7 and pulled down the rest of the crypto market, along with DOGE, he commented, tweeting: “Bitcoin ate some fast food this morning.”