Why did Bitcoin experience intense volatility after breaking through $90,000? Trump's tariff policy reversal triggers a market震荡

Former U.S. President Donald Trump announced on Truth Social on January 21, 2026, that based on the “Future Agreement Framework” reached with NATO Secretary General Mark Rutte regarding Greenland and the Arctic region, he would cancel the tariffs on the EU originally scheduled to take effect on February 1.

Following the announcement, global markets responded immediately: the Dow Jones Industrial Average surged nearly 770 points at one point, while the S&P 500 and Nasdaq Composite both rose over 1.5%. Traditional safe-haven assets like gold briefly plummeted nearly $100.

Event-Driven: Market Tsunami Triggered by a Statement

U.S. President Trump’s statement once again demonstrated the significant influence of his remarks on global capital markets. After meeting with NATO Secretary General at the World Economic Forum in Davos, he posted news on Truth Social regarding the Greenland agreement and tariff decisions. This policy shift triggered a massive market shock due to its dual signaling: on one hand, the cancellation of tariffs eased global trade tensions and brightened economic growth prospects; on the other hand, the achievement of the Greenland framework was seen as a breakthrough in geopolitical maneuvering.

The market reacted swiftly and intensely. The three major U.S. stock indices soared collectively, with the Russell 2000, representing small caps, hitting a record high. Meanwhile, traditional safe-haven assets faced sell-offs, with gold and silver prices plunging sharply. This rapid shift in “risk appetite” directly impacted Bitcoin’s perception. In an environment of liquidity easing and improved economic growth expectations, Bitcoin is increasingly viewed as a high-risk, high-reward growth asset, showing a strong correlation with tech stocks.

Market Response: Volatility and Massive Liquidations

The immediate impact of Trump’s statement was reflected in Bitcoin’s price. Before the news, Bitcoin briefly fell close to $87,000, then rebounded strongly, breaking through the $90,000 mark.

According to Gate market data, as of January 23, 2026, Bitcoin’s latest price is $89,675.8, with a 24-hour trading volume of $1.02 billion and a market capitalization of $1.79 trillion, accounting for 56.51% of the entire cryptocurrency market. Such intense price volatility caused severe shocks to high-leverage traders. Market data shows that over $1 billion in total crypto liquidations occurred in the past 24 hours.

Among these, long positions worth $672 million were liquidated, and short positions totaling $335 million were also forced to close. Bitcoin and Ethereum were the two most affected assets, with $426 million and $366 million in positions forcibly liquidated, respectively.

This sharp market fluctuation once again highlights the high-risk nature of cryptocurrency trading, especially during major news events, where high-leverage positions are highly susceptible to market volatility.

Historical Reflection: How Tariff Policies Influence Crypto Markets

This is not the first time tariff policies have impacted the cryptocurrency market. Looking back to 2025, the Trump administration’s tariff agenda had become one of the most important macro narratives in the crypto space.

In February 2025, when Trump announced new tariffs on Mexico, Canada, and China, Bitcoin dropped to a three-week low, approaching $91,400. Ethereum also declined by about 25% over three days. In May of the same year, as the U.S. and China reached a temporary tariff truce, Bitcoin rebounded strongly above $100,000. This “bad news is good news” rebound pattern showed that the market not only priced in negative news but also held expectations for policy easing.

The most severe test occurred in October 2025, when Trump proposed imposing a 100% tariff on Chinese imports amid a dispute over rare earths, triggering a lightning-fast market crash. Bitcoin plunged over 16% during the rapid decline, with major trading platforms experiencing forced liquidations totaling up to $19 billion in a single day.

Historical experience indicates that tariff policies influence Bitcoin prices through four core channels: growth expectations, inflation outlook, liquidity environment, and risk sentiment. This pattern shows that Bitcoin is no longer an isolated risk asset; its price behavior is increasingly linked to global macro sentiment and liquidity conditions.

Technical Perspective: The Battle at Key Price Levels

From a technical analysis standpoint, Bitcoin is currently at a critical price level battleground. According to Gate market data, Bitcoin’s 24-hour price range is between $88,510.6 and $90,354.9. This range aligns closely with key support and resistance levels identified by market analysts. Technical analysis indicates that around $87,000 to $85,900 is a significant support zone, while the area between $92,300 and $93,300 (near the 50-day and 200-day moving averages) acts as a strong resistance. Further above, the $95,600 to $96,000 zone shows signs of distribution, evidenced by strong bearish candles, indicating many holders are likely to sell at this level.

The Relative Strength Index (RSI) also warrants attention. During periods of intense volatility, Bitcoin’s RSI briefly dropped to around 25, entering oversold territory, signaling waning downward momentum.

The current market structure suggests that despite positive news stimuli, Bitcoin has yet to break through key resistance levels. The average cost basis for short-term holders is around $98,000, which remains an important psychological hurdle for the market to overcome.

Macro Perspective: The Debate Over Bitcoin’s Asset Attributes

This event has reignited in-depth discussions about Bitcoin’s asset nature. While traditional safe-haven assets like gold plummeted, Bitcoin rose in tandem with risk assets. This phenomenon has led to divergent views on Bitcoin’s positioning: Is Bitcoin more like gold, a safe-haven asset, or more akin to stocks, a risk asset?

Proponents of Bitcoin as a safe haven argue that its fixed supply and decentralization make it an ideal hedge against fiat currency devaluation. Notably, renowned investor Ray Dalio has acknowledged Bitcoin as a “store of wealth.” Conversely, skeptics who see Bitcoin as a risk asset point to its high correlation with the Nasdaq index and its sensitivity to global liquidity changes, which are characteristic of risk assets.

The reality may be complex. Bitcoin can exhibit different attributes under varying market conditions: during periods of abundant liquidity and strong economic growth, it behaves more like a risk asset; during times of fiat credit deterioration and geopolitical tensions, its safe-haven qualities may become more prominent.

Fundstrat founder Tom Lee warns that 2026 could see a “painful downturn” in financial markets before a potential rebound. He notes that escalating tariff policies, changes in Federal Reserve independence, and uncertainties surrounding the new Fed chair could cause significant market disruptions early in the year.

Future Outlook: The Dynamic Balance Between Policy and Markets

Looking ahead, the Bitcoin market will continue to face multiple uncertainties. Trump’s tariff policies are just one aspect of the complex macro environment. According to Gate’s model, the average price of Bitcoin in 2026 is projected at $89,660.6, with a range between a low of $60,072.6 and a high of $105,799.5. Some long-term forecasts suggest that by 2031, Bitcoin could reach around $136,269.75.

Swiss bank’s analytical models indicate that as long as the $89,200 support holds, Bitcoin could rally toward $94,800 and even challenge $99,000. If this level is broken, the $84,500 zone below will serve as a critical support line for bulls.

On the macro policy front, issues such as U.S.-China trade relations, global tariff adjustments, digital services tax disputes, and pharmaceutical tariffs could all pose potential risks. These policies not only impact trade but are also key variables influencing global liquidity, inflation expectations, and risk appetite.

The U.S. cryptocurrency legislation process is also a focal point. Trump stated at Davos that he is working to “ensure the U.S. remains the world’s crypto capital,” and revealed that Congress is drafting legislation to structure the crypto market.

Data Behind the Scene: The Current State of the Bitcoin Market

A detailed analysis of current Bitcoin market data provides a more comprehensive understanding of its status. According to the latest Gate data: Bitcoin’s circulating supply is 19.97 million BTC, close to its maximum supply of 21 million BTC at 95%. This limited supply is one of its core value propositions.

Looking at price trends, Bitcoin has decreased by -0.47% in the past 24 hours, down -6.31% over the past 7 days, but still up +2.21% over the past 30 days. Over the past year, its price has declined by -13.58%.

Market sentiment indicators show a current “bullish” outlook, which may consider factors such as market capitalization share, price trends, and macroeconomic conditions.

Notably, Bitcoin’s all-time high was $126,080, still some distance from the current price. Its lowest recorded price was only $67.81, illustrating the asset’s enormous volatility and growth potential.

From the Dow Jones index’s nearly 770-point surge to gold’s $100 drop, from Bitcoin breaking the $90,000 mark to over $1 billion in leveraged positions being liquidated worldwide—every corner of the global markets is responding to Trump’s statement. Bitcoin’s price is struggling to find direction amid intense volatility. The key levels are the $89,200 support and the $98,000 resistance, with the area between $95,600 and $96,000 heavily populated with holders waiting to sell. Markets always swing between fear and greed, and Bitcoin continues to redefine its asset attributes and value boundaries within this oscillation.