- Coinbase Premium Index rallied, indicating greater US demand for BTC
- However, there seemed to be massive lower liquidity that could limit BTC to a certain price range
On Friday January 3, Bitcoin [BTC] rose to almost $99,000 after a recovery in US demand, as reflected in the Coinbase Premium Index. In fact, tHe recently indexed decreased to a 12-month low after a risk-off approach by US retail and institutional investors during the holiday season.
The index also recently regained the key 14-day Simple Moving Average (SMA) for the first time in almost a month. According to CryptoQuant analyst Burak KesmeciThis highlighted greater dominance of American buyers in the market.
“When the Coinbase Premium Index rises above the SMA14, indicating the dominance of Bitcoin buyers, this event is an early indicator that US-based buyers are regaining market dominance.”
Source: CryptoQuant
Bitcoin ETFs record daily inflows of $908 million
The trend was also clearly visible in the US BTC ETF complex. They raked in $908 million in daily net inflows on Friday, marking a monthly high.
Even BlackRock’s IBIT, which started the year with outflows, saw $253 million in inflows on Friday.
Source: Sosowaarde
Fidelity’s FBTC led demand with $357 million and Ark Invest’s ARKB came third with inflows of $222 million. All told, this indicated that institutional demand was back and helped BTC’s steady rise to $98.9k.
Furthermore, the prolonged recovery has been driven by a liquidity chase, as there was a huge pile of short positions at the $98k level earlier this week. Now upside liquidity is between $99,000 and $100,000.
Likewise, the lower liquidity levels (bright yellow zones) appeared to be at $97.2k, $96k and $95k.
Source: Coinglass
Considering that at the time of writing more liquidity appeared to be concentrated at the bottom of the price action, a drop to $97,000-$95,000 cannot be overruled.
Read Bitcoin [BTC] Price prediction 2025-2026
Put another way, the liquidation heatmap suggested that BTC could reach a price range between $96,000 and $100,000 in the near term.
However, it remains to be seen whether strong demand for BTC ETFs will trigger a bullish breakout above $100,000.