Bitcoin (BTC) Price: JPMorgan Analysts Predict Crypto Sell-Off Nearing Bottom

TLDR

• Bitcoin rejected at $93,000 for the third time, pulling back to weekly lows near $89,250
• Open interest climbed as BTC dipped to $90,000, indicating short positions are building up
• US Bitcoin ETFs recorded three-day outflow streak totaling $934.8 million through Thursday
• JPMorgan analysts suggest crypto sell-off may be nearing a bottom as January ETF outflows ease
• Strong passive bids around $90,000 could trigger a short squeeze if support level holds

Bitcoin started 2026 with an 8% surge to $93,000 but faced rejection at this resistance level for the third consecutive time. The cryptocurrency pulled back to weekly lows near $89,250 as traders reassessed their positions.

The current price action shows BTC testing a key order block between $89,200 and $90,500. This range represents the first area where bulls could attempt fresh long entries if momentum turns positive.

Bitcoin continues to hold above the monthly rolling volume-weighted average price, which turned bullish at the start of 2026. This technical indicator provides some support for the current price level.

Short Squeeze Setup Developing

Open interest data reveals an interesting pattern as Bitcoin dipped from $92,000 to $90,000. Open interest climbed sharply during this decline, indicating that short positions are accumulating.

If Bitcoin can defend the $90,000 level, a short squeeze becomes likely. A strong daily close above $91,700 would signal the first confirmation of this scenario.

However, failure to hold above $89,000 would expose internal liquidity from $86,000 to $87,000. This would give sellers a clear downside target.

Order book data from CoinGlass shows strong passive bids around $90,000. Over the past two weeks, similar bid absorption has preceded short-term recoveries.

ETF Flows Show Mixed Signals

US Bitcoin ETFs recorded $205.5 million in outflows on Thursday, marking a three-day streak. The cumulative net outflow reached $934.8 million over this period.

Despite recent outflows, the seven-day net flow remains positive at $240.7 million. Year-to-date, Bitcoin ETFs have logged net inflows of $439 million according to SoSoValue data.

Sean Dawson from Derive cited several factors driving the outflows. These include capital reallocation after year-end, Bitcoin’s failure to break $92,000 resistance, and increased macroeconomic uncertainty.

The start-of-year rally pushed Bitcoin above $94,000 into a zone where recent buyers have their cost basis clustered between $92,100 and $117,400. Glassnode analysts note this creates breakeven sell-side pressure.

JPMorgan analysts led by Nikolaos Panigirtzoglou expressed optimism in a January 7 report. They stated that signs of bottoming out are visible in crypto indicators including perpetual futures and CME futures position proxies.

The banking giant believes retail and institutional investors completed most of their planned trimming during the fourth quarter of 2025. JPMorgan suggested the recent crypto sell-off could be nearing a bottom.

Bitcoin is currently trading around $91,100, with year-to-date gains standing at approximately 4 percent.

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