The Battle for $100K: will it hold or collapse?
Compass 167
In the early week playbook, we outlined this scenario:
Given the negative sentiment, it’s highly likely that the focus will now shift to liquidating bearish positions, as there is liquidity between $103K and $106K.
Jerome Powell's mixed tone gave the markets a boost, and Bitcoin positioned itself in the $104K–$106K zone but failed to break out toward new highs. More will be needed for a rebound, but that option seems to be fading. Let’s see what’s next for Bitcoin.
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Jerome Powell, Chairman of the Fed, had the markets on edge, in a week that was already shaping up to be highly complex due to the crisis sparked by Nvidia and the emergence of DeepSeek’s AI model. The concern wasn’t about rate cuts—everyone already knew there would be no change—but rather about his speech and intervention. Everyone wanted to know if he would pick up the baton left by Trump and respond to the pressure to lower interest rates and continue the pivot that began in September.
"No comment," was Powell’s response when questioned by a reporter, and the topic was not brought up again. This leaves us in a scenario where, even if the Fed Chairman does not yield to President Trump’s demands, Trump will not back down. This sets the stage for growing tensions between both sides. Trump wasted no time and posted that the Fed has done a “terrible job” controlling inflation, regulating banks, and taking measures to "unleash lending" for people and businesses.
This highlights that the dispute is far from over. Neither side is going to hold back in achieving their objectives, which adds uncertainty for investors. Meanwhile, we can assume that it’s now official: inflation is here to stay. We are witnessing a resurgence—a second inflationary wave.
How Bitcoin reacts to this environment in the short term will be decisive for its sustainability in the medium and long term. Much attention has been given to the fact that Bitcoin has not taken off despite having strong fundamentals in its favor, but we should also note that it hasn’t collapsed despite an uncertain macro environment . Today's drop from $106K to $101.5K was a reaction to the decline in stock indices, but it was also a complementary move, as we had already anticipated a downturn from those levels.
Now, we need to see how Bitcoin defines its next moves in this increasingly complex environment.
The Fundamentals Were Signaling It.
The BFI (Bitcoin Fundamentals Index) fell to 47, placing it still in neutral territory but in a weaker position compared to last week. This signals that the short-term bullish trend is hanging by a thread.
In particular, network growth has declined to bearish levels previously seen in early January. However, this isn’t our biggest concern, as the network remains strong and stable. Liquidity remains the major issue—it has broken below its consolidation range and is now approaching levels last seen in May. Back then, this was expected, as it occurred in the weeks following the halving. After hitting that low, liquidity began to recover.
Thus, we should keep this level in mind as a reference and a potential short-term support from which a
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