Bitcoin Sinks As Risk Aversion Takes Hold
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BTC Reverses
Bitcoin bulls will certainly be suffering from whiplash today as the futures market continues to sink lower after last week breaking out of its three months range. BTC is now down around 7% from those highs as global risk sentiment weakens amidst rising trade war risks between the US and EU. Trump has threatened the bloc with a fresh wave of tariffs if it doesn’t co-operate with his demands to purchase Greenland. EU leaders have drawn up a 93 billion Euro package of counter-tariffs ready to be used in response if Trump actions those tariffs. This news has firmly deflated risk sentiment which had been stronger late last week on news that the US would hold off from a military strike on Iran after the regime signalled it would end violence against protestors.
Trump Speaking Tomorrow
The prospect of a fresh trade war and the subsequent hit on the global economy is a big risk factor for investors. Looking ahead this week traders are waiting to hear from President Trump who speaks tomorrow in Davos, followed by EU leaders are Thursday. With risks of a further aggression from Trump, Bitcoin is vulnerable to a further plunge into next week. If there is no change in the current narrative and Trump looks poised to action tariffs on Feb 1st, this could easily see BTC trading at fresh YTD lows. Only a de-escalation in the situation is likely to revive risk sentiment near-term and that is looking highly unlikely currently.
Technical Views
BTC
For now, BTC is reversing lower within the corrective bull channel which has framed the rally off the Nov 2025 lows. Price is now back below the $94,500 level and fast approaching a test of the bull channel lows with risks of a move deeper towards the Nov 2025 lows around $80,185.
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With 10 years of experience as a private trader and professional market analyst under his belt, James has carved out an impressive industry reputation. Able to both dissect and explain the key fundamental developments in the market, he communicates their importance and relevance in a succinct and straight forward manner.