Bitcoin fell below the psychologically critical $90,000 level during Asian trading on January 19–20, 2026, dropping as much as 1.26% to around $89,425 at the lows. The move triggered over $700 million in leveraged liquidations (primarily long positions), pushing the Fear & Greed Index into extreme fear territory at 24. The catalyst appears to be renewed geopolitical and trade-war risk from President Trump’s tariff threats on multiple European NATO countries tied to stalled Greenland sovereignty negotiations. This article examines whether this is the start of a deeper correction signaling the end of the 2026 bull market — or merely a healthy leverage flush clearing weak hands before the next leg higher.
Current Market Snapshot – January 20, 2026
| Metric | Value | Change / Note |
|---|---|---|
| Bitcoin Price | $89,425 (low) → ~$90,200–$90,900 recovery | –1.26% (24h) |
| 24h Trading Volume | ~$160B+ | Elevated panic volume |
| Market Cap | ~$1.78T | Down from recent highs |
| Fear & Greed Index | 24 (Extreme Fear) | Historically contrarian buy zone |
| 24h Liquidations | $700M+ | 80%+ longs → leverage flush |
| Key Support Zone | $88,000–$88,800 | Next major defense line |
| Next Resistance | $91,650–$93,000 | 50% Fib retracement |
Macro & Geopolitical Backdrop: Trump’s Greenland-Linked Tariff Threats
The primary catalyst for the latest risk-off move is President Trump’s explicit threat to impose 10% tariffs on goods from eight European NATO countries (Denmark, Norway, Sweden, France, Germany, UK, Netherlands, Finland), escalating to 25% by June 1, 2026 — unless these nations transfer control of Greenland to the United States.
This unprecedented ultimatum to NATO allies has immediately raised fears of:
- Broader US-EU trade conflict
- Supply-chain disruptions for key European exports
- Potential coordinated EU retaliation
- Accelerated de-dollarization discussions within BRICS & EU
Ethereum Leads Losses – Why ETH Is Underperforming Bitcoin
Ethereum Price Action & Key Levels Right Now
- Current range: roughly $3,100 – $3,300 (very compressed)
- Critical short-term support: ~$3,050 – $3,000 zone
- Very important technical support: ~$2,900 – $3,000 (previous major low + psychological level)
- Nearest resistance: $3,380 – $3,400 (recent local high)
- RSI (daily): around 42–46 → neutral, not yet heavily oversold
→ Ethereum is currently showing classic higher beta behavior — falling harder than Bitcoin during risk-off moves.
Market Structure & Liquidity Situation
- Market-maker liquidity noticeably thinner around $3,200–$3,300
- Significant cluster of long liquidations sitting right below current price
- New address / retail participation has cooled considerably
- Result: very little buy-side defense when sellers step in
Broader Crypto Market Context – Numbers That Matter
- Total crypto market cap: down ~3% → ~$3.21 trillion
- Top 100 coins red: 95 / 100
- Bitcoin dominance: quietly rising → ~58.7–59.2%
- Altcoin market cap bleed: significantly higher beta than BTC
Three Realistic Scenarios for the Next 1–4 Weeks
Scenario 1 – Continued Risk-Off & Deeper Correction (35–40% probability)
- Tariff rhetoric escalates / EU retaliation
- BTC loses $92k → ETH breaks $3,000
- Next ETH target zone: $2,850 – $2,900
Scenario 2 – Sideways Chop & Slow Grind (40–45% probability)
- No major escalation, but also no quick resolution
- BTC oscillates $92k–$97k
- ETH likely trapped $3,050–$3,380 for several weeks
Scenario 3 – Relief Rally / Short Squeeze (15–20% probability)
- De-escalation signal or diplomatic progress
- BTC reclaims $97k → ETH breaks back above $3,380
- Fast move toward $3,500–$3,650 possible
How Tapbit Traders Can Navigate This Environment
- Create your Tapbit account (0% maker fees)
- Deposit USDT
- Defensive spot: Accumulate ETH / strong alts only on confirmed hold of major support
- Futures protection: Short ETH on failed rallies toward $3,380 (isolated margin, 1–2% risk)
- Volatility play: Use Tapbit 125x perpetuals for quick scalps around key liquidation clusters
- Safety first: Never exceed 1–2% account risk per trade
Conclusion
The current crypto market weakness, led by Ethereum’s underperformance and a ~3% drop in total market cap to $3.21 trillion (95/100 top coins red), is a direct reaction to renewed geopolitical and trade-war risk stemming from Trump’s Greenland-linked tariff threats against multiple European NATO members.
While short-term pressure is real, historical patterns show that such risk-off phases frequently create excellent medium-to-long-term entry zones — especially when institutional flows remain supportive on longer timeframes.
The next few days to weeks will be decisive: either continued breakdown toward deeper support levels or a powerful short squeeze on any sign of de-escalation.
Trade ETH weakness & potential reversal on Tapbit:
- Sign Up on Tapbit (0% maker fees)
- Login & Deposit
- Live ETH/USDT & Crypto Prices
Disclaimer: This article is for informational purposes only and does not constitute investment or trading advice. Cryptocurrency markets are highly volatile and subject to geopolitical events. Always conduct your own research (DYOR) and never invest more than you can afford to lose completely.
