Bitcoin Hits New Heights as Trump Takes Office, Market Eyes Strategic Reserve Plans

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MARKETS TREND

Before showing notable volatility during Donald Trump’s presidential inauguration, Bitcoin (BTC) hit unprecedented levels on a historic day for both politics and crypto markets.

Bitcoin Hits New Heights as Trump Takes Office, Market Eyes Strategic Reserve Plans
Bitcoin price on Trump’s inauguration

Before settling below $105,000 as traders assessed the ramifications of the incoming government’s crypto policies, the top cryptocurrency briefly touched $109,321 on January 20th.

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BTC/USD Technical Analysis

BTC/USD

 

The price movement of Bitcoin BTC/USD on inauguration day captured the complicated response of the market to possible policy changes under the Trump presidency. BTC corrected by 8% following its new top, finding support on big exchanges at $101,440. This trend of consolidation points to a normal profit-taking phase following the outstanding 17% year-to- date increases of the asset.

Derivatives data provides crucial insights into market sentiment:

  • Bitcoin futures premium increased modestly to 14% from 12%
  • Options skew metrics hover at -6%, indicating cautious optimism
  • Professional traders maintain neutral positioning, showing reluctance to place aggressive directional bets

Bitcoin Strategic Reserve Implications

With prediction markets predicting a 64% chance of implementation, market attention has concentrated especially on the prospect of a U.S. Strategic Bitcoin Reserve. David Sacks’s nomination as “White House AI and Crypto Czar” reflects the government’s rigorous attitude to bitcoin policy.

Global Political Alignment

A notable “crypto presidency alliance” appears to be forming across the Americas, with three key figures emerging as Bitcoin advocates:

  • President Donald Trump (United States)
  • President Javier Milei (Argentina)
  • President Nayib Bukele (El Salvador)

El Salvador continues to lead by example, recently adding 12 BTC to its national reserves despite IMF pressures, bringing its total holdings to 6,044 BTC valued at approximately $617 million.

Potential Challenges for a BTC Rally

Several factors could impact Bitcoin’s trajectory in the coming months:

  • U.S. federal budget deficit increased 40% in Q1 2025
  • Treasury debt financing costs projected to exceed $1.2 trillion in 2025
  • Potential government shutdown risks amid debt ceiling concerns
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ABOUT THE AUTHOR See More
Arslan Butt
Index & Commodity Analyst
Arslan Butt serves as the Lead Commodities and Indices Analyst, bringing a wealth of expertise to the field. With an MBA in Behavioral Finance and active progress towards a Ph.D., Arslan possesses a deep understanding of market dynamics.His professional journey includes a significant role as a senior analyst at a leading brokerage firm, complementing his extensive experience as a market analyst and day trader. Adept in educating others, Arslan has a commendable track record as an instructor and public speaker.His incisive analyses, particularly within the realms of cryptocurrency and forex markets, are showcased across esteemed financial publications such as ForexCrunch, InsideBitcoins, and EconomyWatch, solidifying his reputation in the financial community.
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