Bitcoin slips back below $90,000 after early-2026 rally fades

Bitcoin has slipped back below the $90,000 level after rallying in the opening days of 2026, as early optimism tied to exchange-traded fund inflows gave way to renewed caution across markets.

BTC rose sharply at the start of the year, briefly approaching $95,000 after roughly $1.2 billion flowed into U.S. spot bitcoin ETFs over the first two trading days, according to The Block’s price page.

The rally has since lost momentum, with prices falling under $90,000 on Thursday as ETF flows turned negative for a second consecutive session and broader risk appetite cooled.

Paul Howard, senior director at Wincent, said the pullback fits with the recent market structure. He said bitcoin and ether could drift lower in the near term to fill a gap on CME futures, adding that macro pressures remain the dominant driver of price action.

“With the start of the year, ETF inflows and Tom Lee’s ETH purchases having helped the early 2026 market, the next natural step for BTC and ETH is likely a break below $91,000 to fill the CME gap,” Howard told The Block.

Wincent’s expert described current conditions as choppy, favoring short-term trading rather than sustained directional bets, and noted that January has historically been a relatively flat month for crypto prices.

Rebalancing, resistance and derivatives

The retracement comes as markets continue to digest bitcoin’s lackluster performance in 2025. Indeed, BTC ended last year down about 6.3%, making it the worst-performing major asset class and marking the first time it failed to outperform in its typical four-year cycle, according to K33. It was also only the second year on record in which bitcoin posted negative returns while the S&P 500 rose meaningfully, a backdrop analysts say has shaped early-2026 positioning.

Analysts at K33, including Head of Research Vetle Lunde and Senior Analyst Anders Helseth, also argued that the early 2026 ETF inflows were part of a rebalancing effect rather than a decisive shift in sentiment. After lagging equities and other assets in late 2025, funds with fixed bitcoin allocations may have been forced to add exposure as the calendar turned, providing short-term support without necessarily signaling renewed conviction, they said.

Onchain data points to a market still in transition as well. Analysis from Glassnode shows that profit-taking pressure eased into year-end, allowing prices to rebound from the high-$80,000 range. However, a dense cluster of supply from investors who bought near prior highs now sits overhead, creating resistance as prices moved back into the low to mid-$90,000s.

Glassnode said bitcoin faces a critical test near the short-term holder cost basis, estimated around $99,000. A sustained move above that level would signal renewed confidence among recent buyers, while failure to reclaim it could leave the market vulnerable to prolonged consolidation or renewed downside.

Derivatives markets also reflect caution. Futures open interest has begun to rebuild after a sharp year-end deleveraging, but positioning remains well below prior peaks. Funding rates have stayed subdued, and options markets show a gradual normalization of skew rather than aggressive upside betting.

Still, several market observers believe recent price action has not affected the long-term bullish outlook.

Keyrock CEO Kevin de Patoul said the latest pullback should be viewed less as a reversal and more as part of a broader structural shift.”Nothing in bitcoin’s fundamentals has changed,” de Patoul said.

He added that “global debt levels continue to rise, reinforcing its role as a balance-sheet asset. Companies, and even some countries, are already holding it strategically. Short-term volatility doesn’t alter that story. What’s different now is scale: larger actors, larger positions, and more deliberate use of bitcoin within risk, treasury, and long-term investment strategies.”