Bitcoin continued to decline on January 21, with the price briefly falling below $88,000. This is a continuation of the weakening trend observed in recent weeks, with market sentiment clearly leaning towards caution. The overall environment is not friendly to risk assets.
When the decline occurred, Bitcoin's price remained around $87,500. Compared to the high point at the beginning of the month, it has dropped significantly. Previous attempts to return to the $95,000 to $100,000 range have all failed. This has continued to erode buyer confidence.
This decline is not a singular market event; it is closely related to changes in the macro environment. Europe has announced a suspension of trade negotiations with the United States, and related legislative work has also been put on hold. This decision comes from a consensus within the European Parliament, with the core reason being that the current political conditions are not suitable for further progress.
European officials have publicly stated that the issues are concentrated on the sovereign and security levels. Topics related to Denmark and Greenland have become key points of divergence. At the same time, tariffs are seen as a tool for exerting pressure, which narrows the negotiation space further. Until the situation improves, the cooperation process will remain frozen.
This news has intensified the market's unease. Global investors are beginning to reassess their risk exposure. In this context, Bitcoin's performance resembles part of the overall risk asset correction rather than an independent issue of the crypto market.
From a price structure perspective, Bitcoin's technical pattern has weakened. Since October of last year, a series of lower highs have formed on the daily chart. The breakdown in November became a turning point, and the subsequent rebounds have been limited in strength and duration.
The changes in trading volume are also noteworthy. During each decline phase, trading activity tends to increase. This indicates that selling pressure is quite concentrated and not just a short-term emotional fluctuation. The market seems to be gradually reducing positions.
The previous key support area has already been breached. The price has failed to stabilize above these levels, making Bitcoin more susceptible to shocks in the face of increased macro uncertainty. If the external environment remains tense, downside risks still exist.
The current macro background is not easy. Relationships between major economies are fluctuating, and there is uncertainty in trade policies and diplomatic directions. During this phase, funds tend to prioritize safety, and high-risk assets naturally come under pressure.
As a highly risky asset, Bitcoin finds it difficult to attract sustained capital inflows in this environment. Even if there are short-term rebounds, they are easily interrupted by selling pressure. This is also the reason for the recent limited performance.
Overall, it is not surprising that Bitcoin has fallen below 88,000. It reflects a broader risk aversion sentiment. The tension between Europe and the United States has only amplified this trend. Under already weak technical conditions, any macro shock can have a magnifying effect.
In the short term, the market still needs time to digest the uncertainty factors. Whether Bitcoin can stabilize depends on whether macro sentiment eases. Before that, volatility and pressure may persist.
#BTC #TRUMP #MarketRebound #cryptooinsigts
