Macro Shockwaves Set the Stage for a 13% Weekly Slide
The first week of February 2026 delivered a blunt reminder that crypto remains tethered to the broader risk universe. News of Kevin Warsh’s likely appointment as the next Federal Reserve Chair ignited an immediate “risk-off” rotation across markets. The U.S. Dollar Index jumped, small-cap equities reversed course, and gold sold off as traders scrambled to free up margin. Within hours, those cross-asset tremors reached Bitcoin, tipping an already leveraged derivatives market into a spiral that sliced through the long-defended $80,000 level.
By February 2nd, BTC printed a nine-month low of $74,500—deepening its weekly loss to roughly 13% and sparking the fiercest debate among veteran traders since the 2024 ETF approval rally. While some observers framed the drop as a healthy pullback inside a still-intact secular uptrend, order-book data told a more brittle story. Spot bids above $80,000 vanished once perpetual funding turned negative, leaving cascading liquidations to fill the vacuum. The result was a textbook “liquidity hunt” that forced even conviction holders to question how much true depth the market possesses when passive inflows pause.
On-Chain Metrics Reveal Stalled Capital Inflows
CryptoQuant’s Realized Cap—a proxy for the dollar value of coins that last moved on-chain—has been effectively flat since mid-December despite headline prices making new highs in January. That divergence matters because it implies fresh money isn’t rotating in fast enough to offset profit-taking by early entrants. Exchange reserves have ticked up modestly, suggesting that at least a portion of long-term holders are seeding liquidity rather than purely accumulating.
MicroStrategy’s once-celebrated cache of 190,000 BTC briefly slipped underwater when price pierced its $76,037 average cost basis. Although the firm faces no forced liquidation risk—its coins are unencumbered—the episode underscored the psychological weight such large positions wield. With ETF creations slowing and no marquee corporate treasuries announcing new allocations, the bid has grown narrow, amplifying each macro tremor.
Who Is Still Buying?
Glassnode’s cohort analysis shows wallets holding 0.1–1 BTC continue to stack steadily, yet that grassroots demand is dwarfed by the size of recent derivatives positioning. At the height of the flush, open interest shed $5.1 billion in under 24 hours, confirming that futures leverage—not spot conviction—had been propping up the prior leg to $83,000.
For bulls, the silver lining is an RSI now lodged near 28, historically a zone where fresh spot bids emerge. The risk is that realized cap must first expand before any bounce can graduate into a sustainable trend.
Technical Outlook and Critical Levels to Watch
Price action remains capped beneath the 50-day EMA and the 200-day SMA—now clustered just above $80,000 and threatening to harden into dual resistance. Immediate support rests at the $74,700–$74,500 band that twice halted Friday’s sell-off. A decisive close below that shelf opens a vacuum toward the $70,800 liquidity pool, coinciding with the 0.382 Fibonacci retrace of the entire 2025-2026 advance.
For traders, the asymmetry heading into the weekend is striking. Funding rates have reset to neutral, suggesting fewer forced sellers remain, yet spot volumes haven’t recovered to January averages. A low-time-frame rally into the $78,400 Fibonacci pivot could face heavy supply from traders eager to exit breakeven longs. Conversely, a clean daily reclaim of $81,000—confirmed by rising open interest paired with positive spot inflow—would invalidate the immediate bear thesis and resurrect calls for a run toward the still-unmet $90,000 measured move projected from last year’s consolidation.
Signals to Monitor Next
• Realized Cap expansion above $1.75 trillion, indicating profitable coins are again changing hands at higher prices.
• Net ETF creations outpacing redemptions for a full week, restoring passive bid support.
• Derivatives basis turning modestly positive without a surge in open interest—a sign of healthy directional appetite rather than speculative excess.
• Macro calendar: the Senate confirmation hearing for Warsh and the March FOMC projections. Any dovish tilt could quickly flip the 2026 narrative back toward risk-on.
