Market Analysis:

On the early morning of January 26, BTC and ETH, the two major mainstream cryptocurrencies, collectively experienced a volume surge and broke through previous consolidation levels, disrupting the prior sideways pattern. Short-term bearish sentiment dominated the market, with funds rapidly withdrawing from cryptocurrencies and shifting into traditional safe-haven assets like gold and silver.

Macroeconomic Aspects:

1. Tensions between the US and Iran suddenly escalated, causing a surge in global risk aversion. Funds fled from high-risk assets such as cryptocurrencies, pushing gold prices close to $5,000 and silver surpassing $100 for the first time. Amid rising geopolitical risks, capital flooded into low-volatility traditional safe-haven assets. Cryptocurrencies, due to their high-risk nature, were heavily sold off, resulting in a reverse trend of “gold and silver soaring + crypto plummeting,” which directly drove this plunge.

2. The EU paused retaliatory tariffs against the US for 6 months, but Trump threatened to impose 100% tariffs on Canada. The Canadian Prime Minister called for “buying domestic products.” Global trade policy uncertainty increased further, putting additional pressure on risk assets.

3. During the early morning BTC plunge, volume exceeded 50%, marking the largest volume release of the weekend. Spot buy orders at support levels of 88,000 and 87,000 were unfilled, with funds flowing out unilaterally; mainstream cryptocurrencies experienced net outflows exceeding $1.2 billion. MEME coins also declined sharply, and the market showed a broad decline pattern.

4. In the past 24 hours, the entire network experienced $664 million in liquidations, with over 200,000 traders liquidated, mainly long positions. Leverage risk was further released. The Fear and Greed Index plummeted to 20 (extreme fear zone). Retail panic selling spread, while institutional investors remained in exit mode. The market lacked buying support.

Trading Recommendations:

Buy the dip: BTC 87,000-87,500, ETH 2,830-2,850 with stop-losses
Attempt short positions: BTC 88,200+ , ETH 2,920+ with quick exits
Special Reminder: Until the gold rally ends and market panic subsides, any bottom-fishing is akin to catching a flying knife!