Bitcoin tumbles to $97k as markets start to crash amid trade war concerns

Bitcoin’s price crashed to $97,000 today, down from highs of $109,500, as global financial markets see a widespread decline.

Traders are scrambling to cover their positions after US President Donald Trump announced 10% tariffs on China, and 25% each for Mexico and Canada on Feb. 1.

Now February has historically always been a bullish month, so Bitcoin’s fall is leading us to wonder if things might be different this year. After all, we are witnessing the strangest case of the bull market cycle in history. Does anyone even know what’s going on anymore?

Sell pressure has dominated all day, pushing Bitcoin to test its $96,000 support level. The BTC/USD chart shows failed attempts to recover to $98,000. If support at $97,000 cracks, the next price target sits between $95,000 and $96,000, as can be observed in the chart below.

Liquidations surge past $872 million as traders flee

Derivatives markets have been hit hard. Data from Coinglass shows that trading volume on Bitcoin derivatives spiked by over 100% to $94.15 billion, but open interest dropped by 1.49%, meaning traders are closing positions in fear of more losses.

Funding rates on Bitcoin perpetual futures contracts remain positive, meaning that long positions continue to dominate, but the imbalance is quickly becoming a liability.

In the past 24 hours, $872 million in crypto liquidations have been, with Bitcoin long positions accounting for $762 million of that total. A $9.67 million long position on Bitfinex was the largest individual liquidation. Bitfinex analysts warn that if Bitcoin prices continue falling, overleveraged long positions will face further forced liquidations, triggering a cascading sell-off.

Despite the heavy selling, some traders are holding out hope for a recovery near $97,000, but that support remains fragile. Historical price action shows that similar liquidation events often drive prices to retest lower ranges before stabilizing.

Technical indicators show bears in charge

The MACD indicator has turned negative, with the MACD line crossing below the signal line, which is a key sign of a strong bearish sentiment. The histogram on the MACD chart is widening in negative territory, and that basically tells us this is not a short-term pullback but part of a larger trend reversal.

Meanwhile, Bitcoin’s RSI has fallen to 47, placing it in neutral territory but approaching oversold levels, and if the RSI drops below 40, the selling pressure will likely get even worse.

The chart also shows a series of lower highs and lower lows, a textbook sign of a bearish market structure. Now any attempt by Bitcoin to retest the $99,000 resistance level could fail without stronger buying momentum.