Bitcoin's $94,000 Challenge: How Yen Rate Hike Eased Macro Pressures and Stabilized Crypto Markets

As macroeconomic headwinds gradually ease and selling momentum slows, Bitcoin faces a critical inflection point. The coming weeks will be decisive for determining whether BTC can retest the $94,000 level or if further downside awaits. The key variable? The return of institutional buying power in the face of stabilizing global financial conditions.

Global Macro Stabilization: How December’s Data Eased Market Turbulence

December proved to be a pivotal “mine-clearing week” for global markets. The confluence of major economic data releases, central bank decisions, and settlement events created uncertainty early on, but by week’s end, markets had largely digested these risks and moved forward.

On December 16, the U.S. Department of Labor released employment data that painted a mixed picture. October recorded a job loss of 105,000 positions, while November posted a modest rebound of 64,000 new jobs—still relatively weak. The unemployment rate climbed to 4.6% in November, marking the highest level since 2022. Despite this softness in the labor market, the data supported the narrative of a manageable economic slowdown rather than a crisis scenario.

Two days later, inflation readings arrived with a surprise to the downside. November’s CPI came in at 2.7% year-over-year—significantly below the expected 3.1%. Core inflation similarly disappointed expectations, rising just 2.6% versus the forecast of 3.0%. While some questioned the data quality due to collection issues during the government shutdown, the market took the numbers at face value: inflation was cooling, and rate cut expectations for 2026 remained intact.

The Bank of Japan’s decision on December 19 added another layer to the macro narrative. Policymakers unanimously voted to raise rates by 25 basis points, bringing the policy rate to 0.75%—a 30-year high. However, Bank of Japan Governor Kazuo Ueda’s accompanying commentary was dovish, emphasizing that future moves would depend on data conditions and that real rates remain accommodative. The market’s pricing of the yen rate hike had already occurred, so the announcement sparked a rebound in USD/JPY rather than the feared carry trade unwind that many anticipated.

The cumulative effect of these events was stabilization. The U.S. stock market’s “triple witching day” (with $7.1 trillion in notional value) settled without drama, with major indexes closing at new highs. Bitcoin, which had been trapped in the $80,000-$85,000 range amid liquidity concerns, began to stabilize. The crypto market had temporarily escaped the worst-case macro scenario.

The Yen’s Strength Impact: Currency Moves and Crypto Market Implications

Understanding the yen rate hike’s role in crypto recovery requires examining the currency dimension. As the yen strengthened against the dollar—reflecting the narrowing interest rate differential—concerns about forced liquidations from unwinding yen carry trades eased considerably. This was precisely the catalyst needed to prevent a deeper market cascade.

The Bank of Japan’s measured rhetoric also proved crucial. By signaling that adjustments would be “data-dependent” and that real rates remained below neutral, Ueda reassured markets that this would not be a hawkish hiking cycle. Traders who had feared a scenario where both the Fed and BoJ were tightening simultaneously—a scenario that would have crushed risk assets—now believed they had been given room to breathe.

This currency stabilization had a direct knock-on effect for Bitcoin. Crypto markets are highly sensitive to carry trade dynamics and global liquidity conditions. The reduced tail risk of a yen shock gave risk assets breathing room. BTC moved from a state of distressed selling to a state of consolidation, down approximately 29% from its October 2025 peak of $126,000 but no longer in freefall.

On-Chain Dynamics: Who’s Buying and Who’s Leaving

The stabilization in macroeconomic conditions didn’t translate into an immediate buying frenzy. Instead, the market revealed a standoff between different participant groups.

Long-term holders—those who accumulated Bitcoin during earlier bull markets—continued their gradual exit. This week alone, nearly 90,000 BTC were activated from long-term wallets into short-term holdings, with approximately 12,686 coins directly sent to exchanges for sale. Combined with short-term sellers, the total sell volume this week reached 174,100 BTC. While this represents a decline from the previous week, it remains at elevated levels, signaling that the deleveraging process is ongoing.

Retail investors mirrored the long-term holder behavior, pulling funds from the market. On-chain supply analysis shows that 67% of BTC is currently in profit, while 33% is underwater—the worst ratio since this bull market began. This suggests that many retail participants are capitulating and exiting their positions.

However, a counterforce emerged. DATs and large whale traders—investors with a proven track record of contrarian timing—began accumulating during the weakness. Over the past two years, this group has demonstrated an exceptional success rate in reading market inflection points and positioning ahead of rebounds. They stepped in as long-term holders and retail investors were leaving, creating a floor beneath the market.

Yet there’s a troubling detail: even as accumulation occurred this week, the combined inflow-outflow across stablecoin and ETF channels turned negative. This means that while some smart money was buying, the retail ETF complex and stablecoin ecosystem were experiencing simultaneous outflows. The result was a tug-of-war that kept Bitcoin rangebound rather than allowing a decisive breakout.

The Critical Question: Will Buying Power Return?

Bitcoin’s current price sits around $89,430, representing a 29% decline from the October high. The $94,000 level remains the near-term technical target that traders are watching. Whether BTC reaches it in the coming weeks hinges on a single factor: the return of broader buying interest through ETF inflows and renewed retail participation.

The macro headwinds have been cleared for now. Economic data is cooperating. The yen’s stabilization has removed a key tail risk. The selloff intensity is diminishing week-over-week. But as of the latest update, institutional inflows through ETF channels remain absent—and without them, any rally faces a natural resistance.

The medium-term picture is even less certain. The eMerge Engine’s EMC BTC Cycle Metrics currently stand at zero, indicating a “downtrend” signal. This technical warning suggests that while short-term recovery is possible, the broader trend remains challenged. Whether Bitcoin ultimately reclaims its $103,000 cost line for short-term traders, retests $94,000 as expected, or drops further into a true bear market will depend on the outcome of the ongoing battle between accumulating whales and departing retail cohorts.

For now, Bitcoin is in a fragile equilibrium—stabilized but not yet bullish, supported by contrarian buyers but lacking the broad participation needed for a sustained rally.