Why is Bitcoin’s price up today? Short squeeze, ETF flows & more

Bitcoin built on its earlier rally induced by softer inflation print and pushed higher to nearly $98k during the trading session on the 14th of January.

It closed at $97.9K, bringing its 2026 rally to 10%, but eased slightly to $96.5K at the time of writing.

Although Bitcoin [BTC] had cleared the $95K hurdle that kept it range-bound since November, the real test for a renewed bullish market structure shift would be reclaiming the 50-week Exponential Moving Average (50-Week EMA).

The 50-week EMA has served as support during major corrections in bull market rallies, and dropping below it typically indicates an entry into a bear phase.

It was cracked when BTC fell below $100k in November, but the 2026 recovery could flip it into support again in case of a weekly close above $97.6k.

Which brings us to the crucial questions: what triggered the latest rally, and will the key support be reclaimed?

Short liquidations lift BTC higher

Bears were forced to the sidelines earlier in the week. In the past two days, short liquidations surged to a two-month high of $125 million.

On the 14th of January, more short positions, about $58 million, were wiped out, suggesting that the mid-week rally was also driven by a liquidity grab.

The market sentiment also shifted to a positive and “greed” level for the first time since October. For perspective, as of Monday, the Crypto Fear and Greed Index was at the “fear” level.

However, after the U.S. inflation print, BTC cleared $95k, and sentiment jumped to “neutral” by mid-week.

Is risk appetite back?

As of writing, the index climbed even higher to the “greed” level. This meant risk appetite was back.

Over the past three days, U.S. Spot ETFs attracted over $1.7 billion in total net inflows, reinforcing the risk-on mode from investors.

In fact, even the overall price momentum turned positive, and some were betting on $98k and $100k before the end of January.

However, as mentioned earlier, only a decisive reclaim of the 50-week EMA support would indicate a renewed bullish momentum.

And since there were still leveraged short positions parked at $99k, another round of liquidity grab may lift BTC price higher.

Otherwise, stalling below the 50-week EMA ($97.65k) may open the possibility of another dip.

Final Thoughts

• BTC extended its mid-week rally to a high of $97.9k thanks to liquidity grab and renewed risk-appetite.
• However, for a confirmed and renewed bull market uptrend, the 50-week EMA must be decisively reclaimed as support.