Bitcoin has kicked off the new year with impressive momentum, as highlighted in the latest Week On-Chain report from glassnode. The cryptocurrency has printed two higher highs, pushing its price up to $98k, signaling constructive price action that traders are closely monitoring. However, this upward surge is now confronting a historically significant supply zone, which could act as a formidable resistance level. This development comes at a critical juncture for BTC traders, who are evaluating whether the current bullish impetus can overcome potential selling pressure from accumulated supply in this range. Understanding this supply zone is essential for making informed trading decisions, as it often represents areas where previous holders may look to offload their positions, potentially capping further gains.

Analyzing Bitcoin's Price Momentum and Key Resistance Levels

Diving deeper into the price dynamics, Bitcoin's recent performance has been characterized by strong upward momentum since the start of 2026. According to glassnode's analysis dated January 14, 2026, BTC has not only established higher highs but has also maintained a bullish structure amid broader market optimism. Traders should note that the extension to $98k marks a significant milestone, with the price bouncing from lower support levels established in late 2025. This momentum is supported by on-chain metrics, including increased transaction volumes and active addresses, which suggest growing network participation. However, the supply zone ahead is no ordinary hurdle; historically, such zones have led to consolidations or pullbacks, with past instances showing price rejections around similar levels. For day traders, this presents opportunities for short-term plays, such as scalping near the $98k mark while watching for volume spikes that could indicate a breakout or reversal. Long-term holders, on the other hand, might view this as a test of Bitcoin's resilience, potentially setting the stage for a push toward six-figure valuations if supply is absorbed effectively.

Trading Strategies Around the Supply Zone

When approaching this supply zone, savvy traders are incorporating multiple indicators to gauge potential outcomes. Key support levels to watch include the $90k to $92k range, which has acted as a floor during recent dips, providing a safety net for bullish positions. Resistance at $98k to $100k could see increased selling pressure, as per historical data from glassnode, where large cohorts of coins were last moved in this price band. Trading volumes have been robust, with daily averages exceeding 500,000 BTC in the spot market as of early January 2026, indicating heightened interest. For those trading BTC/USD pairs on major exchanges, monitoring the relative strength index (RSI) is crucial; currently hovering around 65, it suggests room for further upside before overbought conditions emerge. Options traders might consider protective puts around $98k to hedge against downside risks, while futures markets show open interest building, pointing to speculative bets on a breakout. Cross-market correlations are also worth noting—Bitcoin's movement often influences Ethereum and other altcoins, with ETH/BTC pairs showing relative strength, offering diversification opportunities for portfolio managers.

Beyond the immediate price action, broader market implications tie into institutional flows and macroeconomic factors. With Bitcoin's market cap approaching $2 trillion, inflows from spot ETFs have accelerated, contributing to the constructive momentum. Glassnode's report emphasizes that this supply zone coincides with profit-taking levels for short-term holders, potentially leading to a shakeout of weak hands. Traders should keep an eye on on-chain metrics like the spent output profit ratio (SOPR), which has been above 1, indicating profitable sales but not yet at extreme levels. If Bitcoin manages to close above $98k on a weekly basis, it could invalidate the supply zone's resistance, opening doors to targets around $105k based on Fibonacci extensions from the previous cycle high. Conversely, a rejection here might lead to a retest of $85k support, creating buying opportunities for dip buyers. In terms of trading pairs, BTC against stablecoins like USDT shows tight spreads, ideal for high-frequency trading, while BTC/ETH ratios provide insights into sector rotation. Overall, this phase represents a pivotal moment for Bitcoin, blending technical setups with fundamental drivers, urging traders to stay vigilant with stop-loss orders and position sizing to navigate volatility effectively.

Market Sentiment and Future Outlook for BTC

Market sentiment remains predominantly bullish, fueled by positive developments in regulatory clarity and adoption trends. As Bitcoin bounces into this supply zone, analysts are drawing parallels to previous bull runs where similar resistances were eventually breached amid sustained buying pressure. For stock market correlations, BTC's performance often mirrors tech-heavy indices like the Nasdaq, with recent gains aligning with AI-driven stock rallies, potentially boosting AI-related tokens in the crypto space. Institutional investors are ramping up allocations, with reports of increased over-the-counter trading volumes signaling confidence. Looking ahead, if the supply zone holds firm, traders might see a period of consolidation, allowing for accumulation strategies. Conversely, a decisive break could ignite FOMO-driven rallies, pushing trading volumes even higher. In summary, Bitcoin's current trajectory offers a mix of risks and rewards, with the $98k level serving as a litmus test for the ongoing bull market. By focusing on data-driven analysis, including precise price timestamps and volume metrics, traders can position themselves advantageously in this evolving landscape.