Bitcoin USD Breaks $90K Support as Japan Bond Turmoil Triggers -3.11% Selloff

Bitcoin USD is trading at $89,897.19 as of January 21, 2026, down 3.11% over the past 24 hours. The sharp decline follows turmoil in Japan’s bond market, which triggered a broader selloff across global equities and cryptocurrencies. Higher Japanese yields are unwinding a long-standing source of cheap funding that has supported risk assets worldwide. The Nikkei index fell 2.5% while the S&P 500 dropped over 2%, creating a risk-off environment that pressured Bitcoin below critical support levels. Market data shows Bitcoin trading volume increased 24% as traders repositioned amid geopolitical uncertainty and trade war concerns.

Why Is Bitcoin USD Dropping Today?

Bitcoin USD’s 3.11% daily decline stems from multiple converging factors. Japan’s bond market volatility triggered a liquidity crunch that forced unwinding of carry trades globally. When Japanese yields rise, investors exit cheap yen-funded positions, creating cascading selling pressure across risk assets. Trade tensions between the U.S. and Europe added to the bearish sentiment, with President Trump’s tariff threats spooking institutional investors.

Crypto markets are particularly sensitive to liquidity shifts because they operate 24/7 without circuit breakers. The $865 million in liquidations recorded on Monday demonstrated how quickly leveraged positions unwind during volatility spikes. Bitcoin’s break below $90,000 was decisive, with heavy-bodied candles leaving little room for interpretation. Gold surged 4% to $4,866 per ounce as capital rotated toward safe havens, showing clear risk-off positioning across all asset classes.

Bitcoin USD Technical Analysis

Bitcoin USD’s technical indicators reveal mixed signals with underlying weakness. The RSI sits at 48.91, indicating neutral momentum with no overbought or oversold conditions. The MACD shows a bearish signal with the histogram at 721.64, suggesting selling pressure remains elevated. The ADX at 25.89 confirms a strong trend is in place, though the direction remains contested.

Bollinger Bands show Bitcoin trading near the middle band at $88,709, with the lower band at $84,208.69 providing key support. The upper band at $93,209.41 now acts as resistance. Stochastic indicators at %K 54.73 and %D 68.50 suggest momentum is cooling but not yet oversold. The Williams %R at -54.69 indicates selling pressure, while the ATR of 3,252.65 shows elevated volatility typical of market dislocations.

Bitcoin USD Price Forecast

Monthly Forecast: Bitcoin USD is projected to reach $92,791 by February 2026, representing a 3.22% gain from current levels as volatility stabilizes and liquidations clear. Quarterly Forecast: By March 31, 2026, the forecast targets $125,516.64, a 39.65% increase that assumes resolution of trade tensions and restoration of carry trade funding. Yearly Forecast: The 12-month target stands at $95,894, a 6.65% advance reflecting normalized market conditions and institutional accumulation.

Forecasts may change due to market conditions, regulations, or unexpected events. The quarterly projection assumes geopolitical tensions ease and central banks maintain accommodative policies. If trade wars escalate or Japan tightens monetary policy further, downside targets near $80,000 become possible. Conversely, if institutional adoption accelerates and ETF inflows resume, Bitcoin could challenge the year-high of $126,296.

Market Sentiment and Trading Activity

Trading Activity: Bitcoin USD volume surged to 513.3 million coins on January 21, 2026, up 24% from the 30-day average of 745.4 million. This elevated volume during a decline signals capitulation selling rather than gradual distribution. Major holders like MicroStrategy added $2.13 billion in Bitcoin last week at higher prices, showing institutional conviction despite short-term weakness. Delaware Life and BlackRock launched Bitcoin-inclusive insurance products, indicating long-term institutional positioning.

Liquidation Data: Over $865 million in leveraged positions were liquidated during Monday’s selloff, with the majority occurring on derivatives exchanges. The rapid liquidation cascade suggests many traders were caught off-guard by the Japan bond shock. Crypto whales accumulated Ethereum and Bitcoin during the dip, according to on-chain data, contrasting with retail selling pressure. This divergence between whale accumulation and retail liquidations historically precedes recovery phases.

Global Market Context and Regulatory Developments

Bitcoin USD’s decline reflects broader market dynamics beyond cryptocurrency. The World Economic Forum in Davos is drawing world leaders, with President Trump’s speech expected to set the tone for trade policy. Tariff threats against European nations and pursuit of Greenland have created uncertainty that benefits safe-haven assets like gold and U.S. Treasury bonds. The crypto market’s 4.27% decline over 24 hours mirrors equity market weakness, showing Bitcoin’s correlation with risk assets remains high.

Regulatory developments provide some support. The White House confirmed that $6.4 million in Bitcoin seized from Samourai Wallet creators will be added to a national Bitcoin reserve rather than liquidated. This signals government recognition of Bitcoin’s strategic value. South Korea’s customs authority dismantled a $102 million crypto laundering scheme, showing regulatory enforcement continues. These developments create a mixed backdrop where institutional adoption accelerates while short-term volatility persists.

What Could Drive Bitcoin USD Recovery?

Several catalysts could trigger a Bitcoin USD recovery from current levels. Resolution of U.S.-Europe trade tensions would reduce risk-off positioning and restore appetite for growth assets. If Japanese bond yields stabilize, the carry trade unwinding would reverse, releasing trapped liquidity back into risk assets. Historical data shows Bitcoin recovers quickly after liquidation cascades clear excess leverage from the system.

Institutional inflows provide another support mechanism. Bitcoin ETF flows reached $2.17 billion last week, the highest since October 2025, showing sustained demand despite price weakness. Corporate treasuries like MicroStrategy and Steak ‘n Shake continue accumulating Bitcoin, signaling confidence in long-term value. If the golden cross pattern holds on daily charts, technical traders may initiate fresh long positions. The prediction market on Myriad shows 72.5% odds for Bitcoin reaching $100,000 before declining to $69,000, indicating market participants expect recovery.

Final Thoughts

Bitcoin USD’s 3.11% decline on January 21, 2026, reflects global liquidity pressures rather than fundamental weakness in cryptocurrency adoption. The Japan bond market shock triggered carry trade unwinding that forced liquidations across risk assets, with Bitcoin breaking below $90,000 on heavy volume. Technical analysis shows neutral momentum with strong trend confirmation, suggesting consolidation before the next directional move. The quarterly forecast of $125,516.64 assumes geopolitical tensions ease and institutional adoption continues accelerating. Market data reveals a divergence between whale accumulation and retail liquidations, historically a bullish setup. Regulatory developments like the national Bitcoin reserve and corporate treasury purchases demonstrate growing institutional recognition. While short-term volatility will persist, the $84,208.69 support level from Bollinger Bands provides a clear floor for risk management. Traders should monitor Trump’s Davos speech and Japanese yield movements as key catalysts for the next Bitcoin USD move.

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Disclaimer:

Cryptocurrency markets are highly volatile. This content is for informational purposes only. The Forecast Prediction Model is provided for informational purposes only and should not be considered financial advice. Meyka AI PTY LTD provides market data and sentiment analysis, not financial advice. Always do your own research and consider consulting a licensed financial advisor before making investment decisions.