Bitcoin – Why ‘Greed vs. Fear’ will be the trading decision to shape the first quarter

• Bitcoin is entering a high-stakes game where the bold can thrive
• While FOMO builds, there’s still plenty to unpack

Two crashes in less than a month might make you think about quitting, but Bitcoin [BTC] holds above $90,000, defying expectations. It’s clear the market is gearing up for the start of the next Trump trade, but the stakes couldn’t be higher. So brace yourself.

The market is teetering on the edge of greed and fear

Despite the two major clashes with the Fed, Bitcoin’s reputation as a safe haven is proving its worth. A year ago, this shock could have provoked a much stronger reaction. But here we are: Bitcoin fell from its annual high of $102,000 a week ago. And yet the price remains stable, with a decline of only 7%. That is resilience.

With Trump’s inauguration approaching, there is talk of a repeat of the fourth quarter rally that saw Bitcoin soar to $108,000. For many, holding onto Bitcoin seems like a smart play right now.

However, there is a catch. The magnitude of the losses during this dip was hard to ignore. About 1.9 million BTC bought for $106,000 are at risk of being sold once Bitcoin reaches that price, potentially triggering a massive $201 billion sell-off.

Source: IntoTheBlock

With the aftermath of two major crashes still lingering, the decision to HODL feels uncertain to many. Exiting may seem like a safer option than holding on to a higher return. The greed fear balance will be crucial in the coming days – it is delicate and definitely something to keep a close eye on.

History shows that strong rallies are often driven by greed. When greed takes over, investors are more willing to risk it all, believing that the potential for higher returns ‘outweighs’ the threat of a crash.

Unfortunately, with so many macroeconomic factors still at play, fear could easily dominate the market. If it does, a crash could quickly go from social media chatter to full-blown reality.

It’s flight or fight for Bitcoin

Aside from Trump’s inauguration, the Jan Fed meeting in just 16 days could impact the market. Plus, we’re about to get the final CPI and PPI inflation data before the Fed’s decision.

With inflation at 2.7%, well above the Fed’s 2% target, the central bank is likely to remain aggressive, potentially triggering a market pullback. The coming days will be crucial.

Source: US Inflation Calculator

Read Bitcoin’s [BTC] Price forecast 2025-26

Given all this, panic selling could increase as Bitcoin reaches key levels. The Trump trade could be in trouble and Bitcoin could be in for a rough year. It’s clear the long rally is under pressure – fear could take over, making it safer to get off course.