Bitcoin Price Prediction – BTC Could Rally to $90k as Optimism Builds Around CLARITY Act

Highlights:

• Bitcoin trades near $79,700 as volume jumps 116%, showing stronger bullish momentum.
• BTC briefly reclaimed $80,000 for the first time since January, lifting market optimism.
• CLARITY Act progress, resistance breakout, and short squeeze pressure may push BTC toward $90,000.

Bitcoin (BTC) is in the green today, reflecting the market’s rising bullish momentum. When writing, Bitcoin was trading at $79,589.96. In the same period, Bitcoin trading volumes have shot up by 116.17% to stand at $34.31 billion. The rising volumes hint at a buildup in FOMO and could signal a short- to medium-term rally to new highs. 

A key factor driving the excitement is that Bitcoin has tested the $80k mark over the last 24 hours. This is the first time Bitcoin has achieved this feat since January. This has sparked investor excitement that the worst may be over for Bitcoin and that it is likely headed back to its previous all-time highs. Several factors are driving investor excitement in Bitcoin at the moment.

Positive News Around CLARITY Act Pushes Bitcoin to $80k

The biggest one, which triggered the brief cruise past $80k, is news that the CLARITY Act could soon be headed for a full Senate vote. This is because the key players have agreed on the contentious issues that were stalling the bill in recent months. The excitement is that with the major issues around the bill now resolved, it will likely cruise through the Senate. The impact is significant, as it will fully entrench cryptocurrencies in the US financial system by eliminating the loopholes that have held back full adoption in past years.

🇺🇸 A CLARITY Act markup is expected by July.

Cynthia Lummis, Subcommittee on Digital Assets chair and Wyoming senator, suggested that the “bill is nearing the finish line.”

3/7 pic.twitter.com/nZKALBe9EC

— CoinMarketCap (@CoinMarketCap) May 3, 2026

The implication is a major inflow of TradFi capital into the cryptocurrency market. Some analysts project that, once CLARITY passes, the market could see inflows of over $2 trillion in the short term. Since Bitcoin tends to take up most of the capital that flows into the cryptocurrency market, this means up to $1 trillion, or more, in new capital flows into Bitcoin. With scarcity built into Bitcoin as a feature, CLARITY could send Bitcoin to new highs in the foreseeable future.

Capital Rotation Back Into Risk-on Assets Favors Bitcoin Rally

Outside of the excitement around the CLARITY Act, Bitcoin is also gaining from the ongoing capital rotation into risk-on assets. When the Iran war started, capital fled into risk-off assets. At the time, risk-off assets such as Gold were giving superior returns. However, the markets have priced in the idea that the war is over. This has triggered heavy capital rotation into risk-on assets. The rotation is most evident in US stock indices, which are currently trading at all-time highs.

S&P 500 is at the all time highs, while the biggest stocks are still down -20-30%

— Andrew (@AndrewTradesNQ) May 4, 2026

While Bitcoin is yet to catch up to the momentum of the stock markets, it is overall trading in line with them. As such, it will also return to all-time highs. This is drawing in new capital, gradually pushing Bitcoin through critical resistance levels as it surges higher. Now that it has broken the $79k resistance, a continuation of the momentum in the stock markets could see Bitcoin target $90k next. The short squeeze triggered by Bitcoin’s rally to $80k could add to the momentum as short sellers are forced to buy and cover their positions.

Technical Analysis – Bitcoin Eyes $90k After Breaching Key Resistance

On May 4, Bitcoin rallied through the $79,316 resistance level, with high volume. While there has been a slight intraday correction, Bitcoin remains firmly above $79,316, signalling an attempt at a retest within an overall bullish market structure. If Bitcoin sustains the momentum it has built up so far, a rally to $90k could follow.

However, if momentum drops, two scenarios could play out in the short term. The first one is a possible consolidation above $79,316, now support. The second is where bears take control and push the price down to $79,316. In such a case, Bitcoin could drop to the $75,527 support in the short term. Of these scenarios, a rally to $90k is more likely due to strong capital rotation back into risk-on assets.