Bitcoin (BTC) hovered near the $88,000 mark on Monday, showing little movement as gold and silver continued their impressive rallies before slightly pulling back.
After experiencing a wave of frantic selling over the weekend, BTC managed a modest recovery but still fell short of Friday’s peak close to $90,000. The looming threat of a U.S. government shutdown by January 31st—along with concerns about reduced liquidity—was a key factor behind Sunday’s selloff.
Interestingly, this same news failed to deter precious metals investors. Gold surged past $5,000 and then crossed the $5,100 threshold for the first time ever during Sunday and Monday trading sessions. Silver also climbed sharply to reach highs around $118. However, signs of market fatigue have emerged: gold has since pulled back to approximately $5,043 (still up 1.3% for the day), while silver retreated to about $108 but remains elevated by 7%.
Crypto analyst Will Clemente captured investor sentiment succinctly: “Gold and silver casually adding an entire bitcoin market cap in a single day.”
The U.S. dollar index (DXY) weakened significantly—the lowest level since September—as reports surfaced that the Federal Reserve collaborated with Japan’s central bank in currency interventions aimed at strengthening the yen against the dollar. On Monday, USD/JPY dropped over 1%, settling near 154.07 yen per dollar.
Bitcoin Expected To Stay Within Current Range
The absence of strong upward momentum in Bitcoin despite dollar weakness has made traders wary in the short term; Swissblock analysts highlighted this cautious stance in their Monday report stating that recent price trends reinforce bearish expectations.
A decisive fall below support at around $84,500 could trigger deeper declines toward roughly $74,000 according to their analysis; however if this support holds firm amid easing risk factors it might present an attractive buying opportunity for bulls.
Bitfinex experts shared similar cautionary views suggesting BTC will likely trade sideways between approximately $85K and just under $95K for now. They also noted changes within options markets where participants are tactically managing short-term risks without factoring long-term volatility into prices yet.
This implies traders are “pricing transitory risk rather than sustained disruption” within market structures as per Bitfinex commentary issued on Monday.
Additionally pressuring Bitcoin prices is ongoing outflow from spot bitcoin ETFs totaling more than US$1.3 billion last week alone—a clear sign investors remain hesitant toward taking on further risk currently.
The Impact Of Government Shutdown Risks On Crypto Legislation
Jim Ferraioli from Schwab’s crypto research division expressed skepticism regarding any significant price advances unless accompanied by improvements across key indicators such as blockchain activity levels or positive ETF flow trends alongside stronger miner engagement metrics.
A more impactful driver could be progress on passing legislation like The Clarity Act; however potential delays caused by government shutdown threats may stall such developments temporarily—leading Ferraioli to anticipate tight trading ranges between low-$80Ks up through mid-$90Ks until institutional players feel confident enough to re-enter markets fully.