Bitcoin experienced notable losses as it approached the weekly close, amid increasing fears related to potential macroeconomic upheavals.
Key Highlights:
- Bitcoin’s value dipped by over 1.6%, reaching figures as low as $87,471 on Bitstamp.
- Factors such as government shutdown threats and macroeconomic reports are causing traders to retrench.
BTC/USD one-hour chart
BTC/USD one-hour chart. Source: Cointelegraph/TradingView
CoinGlass data illustrated over $250 million in crypto liquidations over a 24-hour period, predominantly affecting long positions.
Crypto liquidations
Crypto liquidations (screenshot). Source: CoinGlass
The market sentiment is notably tense, partly driven by the implications of possible government actions. The Kobeissi Letter highlighted:
“BREAKING: Bitcoin falls below $88,000 as $60 million worth of levered longs are liquidated in 30 minutes. A government shutdown is now expected, and President Trump has threatened 100% tariffs on Canada.”
Additionally, predictions regarding the Federal Reserve’s interest rate meetings suggest minimal changes, despite ongoing pressures to reduce rates even further.
Fed rate predictions
Fed target rate probabilities for Jan. 28 FOMC meeting (screenshot). Source: CME Group
Opinions among analysts regarding Bitcoin’s future vary, with some suggesting a bullish divergence may arise when compared with silver:
“For the first time in history, $BTC might print a bullish divergence against Silver on the 3-Day Timeframe.”
— Michaël van de Poppe, Trader and Analyst
While some traders speculate that Bitcoin could retrace to the low $80,000s, others note significant opportunities may arise amidst fluctuating market conditions.
BTC liquidation heatmap
BTC liquidation heatmap. Source: CrypNuevo/X
In this time of volatility, market watchers are advised to remain cautious and proactive.
