After a 10% correction from the all-time high of $108,300 on December 17, 2024, Bitcoin is preparing for a new rally.

Ryan Lee, chief analyst at Biget Research, believes that Bitcoin could surpass $120,000 in January, a movement potentially triggered by Donald Trump’s inauguration on January 20. Lee predicts that Bitcoin could exceed $120,000 in the short term, but a correction might follow due to profit-taking. Furthermore, the “January effect” could come into play at the beginning of 2025, with renewed investments and increased market optimism.

To gauge Bitcoin’s performance, investors should monitor spot Bitcoin exchange-traded fund (ETF) inflows, the performance of the US stock market, and the upcoming FTX repayments scheduled for January 3.

Lee’s predictions align with those of other analysts who believe Bitcoin will reclaim six-figure prices in January.

$45 Billion Stablecoin Reserves to Fuel Bitcoin Rally

The anticipated rally in January will benefit from nearly $45 billion worth of stablecoin reserves. Binance’s stablecoin reserves reached $44.5 billion as of December 31, 2024, coming very close to the all-time high of $45.8 billion recorded on December 11. According to CryptoQuant data, these reserves contributed to Bitcoin’s price increase.

On December 11, 2024, Bitcoin saw an over 4.7% intraday rise, closing above $101,000, driven by stablecoin reserves.

An increase in stablecoin inflows into crypto exchanges signals potential buying pressure and rising investor interest, as stablecoins are the primary on-ramp from fiat to the crypto world.

Bitcoin is expected to face significant resistance above $95,000 and $96,400. If it surpasses these levels, it could trigger a $1.24 billion liquidation of leveraged short positions across all exchanges, according to CoinGlass data. A move above $96,400 could result in a major reset.

Bitcoin’s $160K Target for 2025

Bitcoin has high targets for 2025. Some analysts predict the price could reach $160,000, driven by improving US financial policies.

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