BitcoinMarkets
|5 min ReadBitcoin Breaks Down While Tech and Gold Bounce Back
Maya Chen
Senior Analyst
Published
Jan 16, 2026
A dramatic reversal hit U.S. markets on Friday. Tech stocks found buyers. Gold staged a sharp rebound. But Bitcoin? It sank again, slipping under $94,000 and printing its lowest level in six months. The split is striking. In a market where money rushed back into risk, crypto stayed frozen. The question now is simple: why is Bitcoin the only major asset that can’t get off the floor?
Stocks Rebound, Gold Snaps Back, Bitcoin Keeps Sliding
U.S. equities opened with panic and closed with confidence. The Nasdaq 100 and S&P 500 bounced cleanly off their 50-day moving averages. The Mag7 index flipped from deep red to flat. ETF flows surged to 37 percent of total volume, well above the yearly average. Even gold, after a brutal 4,080.
Bitcoin was the outlier. It fell 5 percent, tagging 126,000, Bitcoin has shed roughly 25 percent of its value. The total crypto market has erased more than $1 trillion since the October 10 flash crash.
The pain comes despite conditions that normally help high-beta assets. Goldman Sachs traders described a morning that flipped from “absolute panic” to “aggressive risk-on.” Hedge-fund buying hit the 96th percentile. High-beta momentum stocks ripped 6 percentage points off the lows. But Bitcoin never joined the reversal.
Bitcoin Tracks Nasdaq on the Way Down, Lags on the Way Up
Bitcoin’s correlation with the Nasdaq 100 is still near 0.8. But the behavior is skewed. BTC is absorbing the downside volatility of tech stocks without sharing their upside.
When the Nasdaq rises, Bitcoin barely reacts. When the Nasdaq falls, Bitcoin drops more. This is not correlation breaking. It’s correlation turning asymmetric — a negative performance skew that hasn’t been this extreme since late 2022, one year after the previous cycle top.
What changed? Narrative capital shifted. The incremental risk appetite in 2025 is flowing into AI, megacap tech and small-cap equities — not crypto. Bitcoin kept its high-beta downside profile but lost its upside leadership. With ETF inflows slowing, stablecoin supply flattening and exchange depth thinning, the market structure now amplifies weakness.
Fear Index Hits Its Lowest Level of the Year
Crypto sentiment has cracked. The Fear & Greed Index fell to 15 — the lowest since February.
The last time the index dropped below 20, Bitcoin fell another 25 percent within a month. Santiment data shows negative commentary on BTC, ETH and XRP overwhelming positive mentions. Market psychology hasn’t recovered from the October liquidation spiral. If anything, it has deteriorated.
Extreme fear can mark local bottoms, but the price action hasn’t confirmed a turn.
Long-Term Holders and Early Whales Are Selling Into Weak Demand
The biggest weight on the market is supply. Long-term holders have sold roughly 815,000 BTC in the last 30 days — the most since early 2024. Seven-year-plus wallets are unloading more than 1,000 BTC per hour.
These aren’t panic dumps. It’s a steady, overlapping wave of distribution. For many early adopters, $100,000 was always the psychological target. With that level broken, supply finally hit the market.
The deeper problem is absorption. Earlier this year, ETF inflows and MicroStrategy accumulation offset long-term holder selling. That demand is gone. Bitcoin ETFs have now seen five straight weeks of net outflows totaling $2.6 billion. Market depth and spot liquidity remain fragile.
Whale selling isn’t unusual. Whale selling against weak buy-side interest is.
Even the Trump Crypto Portfolio Is Taking Damage
The downturn has dragged down the assets most closely tied to the White House. Stocks and tokens linked to Trump Media, World Liberty Financial and American Bitcoin have fallen roughly 30 percent since the October BTC peak.
Donald Trump indirectly holds more than 115 million DJT shares via a trust; that stake is now valued near 2 billion a month ago. The family’s World Liberty Financial token holdings have slipped from 3.4 billion. Eric Trump’s American Bitcoin stake has dropped from 340 million.
The administration pushed aggressively to support the crypto sector — from dropping SEC lawsuits to establishing a strategic Bitcoin reserve. But a favorable policy backdrop hasn’t stopped the market from bleeding.
A Market Searching for Buyers
The core story is simple. Every major macro asset snapped back except Bitcoin. Liquidity remains thin. ETFs aren’t buying. Stablecoin growth is flat. Long-term holders are cashing in. And the tech-equity boom has pulled attention away from crypto just as the market needed fresh demand.
Bitcoin is still trading with risk assets, but only on the downside. Until something shifts — liquidity, sentiment, ETF flows or long-term supply — the path of least resistance stays down, even as the rest of the market finds reasons to bounce.
Disclaimer: This document is intended for informational and entertainment purposes only. The views expressed in this document are not, and should not be taken as, investment advice or recommendations. Recipients should do their own due diligence, taking into account their specific financial circumstances, investment objectives and risk tolerance, which are not considered here, before investing. This document is not an offer, or the solicitation of an offer, to buy or sell any of the assets mentioned.