Bitcoin (BTC) dropped to $84,300 on January 29, extending losses beyond 5 percent as derivatives traders faced mounting pressure from sustained selling.
The decline broke through critical support at $86,000 that had held through multiple tests during the previous week's volatile trading sessions.
Major altcoins followed Bitcoin lower with Ethereum (ETH) falling slightly below $2,800, Solana (SOL) dropping to $116, and Cardano (ADA) declining to $0.33 as risk appetite weakened.
What Happened
Bitcoin's breakdown below $85,000 came after failing to sustain momentum above $90,000 through late January. The cryptocurrency has now fallen 33 percent from its October peak of $126,200.
Total cryptocurrency market capitalization declined to $2.87 trillion amid elevated trading volumes exceeding $47 billion over 24 hours. The combination of falling prices and sustained volume indicates active repositioning rather than illiquid market conditions.
Derivatives data shows leveraged long positions absorbed substantial losses as price support levels failed. Bitcoin has experienced multiple liquidation waves throughout January, including $1.09 billion on January 21 and $680 million on January 19.
Long-term holder distribution patterns show sustained selling pressure with on-chain data indicating consistent supply hitting markets through late January. The 100-week moving average near $87,145 previously provided structural support but failed to contain selling momentum.
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Market Structure
ETF flows remained negative through late January with cumulative outflows exceeding $1.3 billion over the past week. Institutional appetite has weakened as Bitcoin failed to establish momentum above psychological resistance at $100,000.
The Fear and Greed Index reached mid-fear territory at 38, typically associated with potential bottoms but not guaranteeing immediate reversals. Technical indicators show Bitcoin below its 50-day moving average near $90,000.
Critical support levels exist at $84,099 representing aggregate cost basis for US spot ETF buyers and $82,713 marking the 2024 average exchange withdrawal price. A sustained break below $80,000 would likely test April 2025 lows near $76,000.
Futures markets show thin liquidity conditions making price vulnerable to sharp movements once forced positioning unwinds. Funding rates across perpetual contracts remain near neutral, indicating leverage has been substantially reduced from earlier January levels.
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