Bitcoin Finds Footing as Weekday Traders Step In Following Steep Weekend Sell-Off

The cryptocurrency market opened the week on a steadier note, with Bitcoin (BTC) bouncing off key support levels after a sharp weekend decline that rattled traders. The rebound, while modest, suggests underlying demand persists among weekday participants, even as retail investors remain largely on the sidelines.

After trading as low as $74,800 over the weekend—a level not seen since mid-2025—Bitcoin managed to climb back above $76,500 during Monday's session. For market bulls, the ability to hold above the $74,000 threshold is being viewed as a critical technical and psychological victory.

Liquidation Cascade and Weekend Illiquidity

The weekend's sell-off was exacerbated by a cascade of forced liquidations in the derivatives market. Data from Coinglass reveals that nearly $2.5 billion in leveraged positions were liquidated in the past five days, with a single-day spike of over $1.68 billion on January 31st. "When prices fall sharply in a thin market, it triggers a chain reaction of stop-losses," explained Benjamin Cohen, a senior analyst at Digital Asset Research. "Weekend liquidity is often insufficient to absorb large sell orders, leading to these exaggerated moves."

Macro Headwinds Gather

Beyond technical factors, analysts are eyeing mounting macroeconomic pressures. The impending leadership change at the U.S. Federal Reserve, with Kevin Warsh nominated to succeed Jerome Powell in 2026, has introduced fresh uncertainty. Warsh's historically hawkish stance has sparked concerns that the era of ultra-loose monetary policy may be drawing to a close, a prospect that typically weighs on risk assets like cryptocurrencies.

Geopolitical tensions in the Middle East, marked by escalating friction between Israel and Iran, have further fueled a flight to safety, diverting capital away from volatile digital assets and into traditional havens like the U.S. dollar and Treasury bonds.

ETF Flows: A Key Bellwether

Attention is now focused on the flows into U.S. spot Bitcoin ETFs, which have recently turned negative. Last week saw net outflows exceeding $1.4 billion, a significant shift that dampened market sentiment. "The ETF channel is crucial," noted Cohen. "It's the primary bridge for traditional capital. We need to see sustained positive inflows to solidify this recovery and restore broader confidence." Market participants will be watching daily flow data closely for signs that institutional interest is returning.

Trader Commentary

Marcus Chen, Portfolio Manager at a Hong Kong-based crypto fund: "This is a healthy consolidation after a massive run-up. The fundamentals of network adoption haven't changed. Weekday buying from ETFs and funds provides a much more stable foundation than weekend retail speculation."

Sarah Jenkins, Independent Retail Trader: "It's exhausting. Every dip is called a 'generational buying opportunity' by the same voices that were predicting $100k last month. The leverage in this market is insane, and the little guys get wiped out in these liquidations. It feels more like a casino than an investment."

David Park, Technology Venture Capitalist: "The short-term noise around Fed policy and geopolitics is distracting from the long-term structural shift. Institutional adoption through regulated vehicles is a one-way street. Volatility is the price of admission for this asset class."

Rebecca Vance, Financial Journalist: "The market is at an inflection point. The narrative is shifting from pure monetary policy speculation to one that must also account for real-world adoption and regulatory clarity. This pullback tests that new thesis."

The path forward for Bitcoin appears contingent on a stabilization in ETF flows and a calming of macro fears. While the weekday bounce offers a reprieve, traders are bracing for continued volatility as the market searches for a new equilibrium.