Archax Weekly Market Update, Feb 02, 2026

Crypto enters the week under renewed pressure after a sharp weekend sell-off, with Bitcoin sliding to its weakest levels since last spring and Ethereum and the broader alt complex following lower. The move has been a reminder that despite the growth of the ecosystem, crypto market direction is still being set by Bitcoin, with diversification benefits proving limited when stress hits.

A key takeaway from the latest drawdown is how quickly crypto’s internal correlation regime reasserts itself. When Bitcoin breaks lower, liquidity fragments, risk is cut across the board and smaller tokens tend to move in symphony rather than offering meaningful offset. That dynamic has become more visible in this cycle as market structure has professionalised: the ecosystem is larger, but the core driver of positioning and leverage is still Bitcoin, and the rest of the market continues to trade as a beta expression of it.

At the same time, the rebound attempts have been repeatedly capped, and the price action below $90,000 has started to look structural rather than incidental. One reason the market has struggled to sustain bounces is that sell pressure has consistently reappeared into the high $80,000s, with traders focused on a tight “tug of war” zone marked by heavy offers below $90,000 and notable demand clustered nearer the mid-to-high $87,000s. That setup has kept rallies short-lived, reinforced a fade mentality, and left the market vulnerable to renewed downside when momentum stalls.

The broader macro backdrop has also been unhelpful. Cross-asset markets have started February in a volatile mood following what can only be described as a forced deleveraging episode. A sharp reversal in precious metals triggered margin calls and liquidation pressure, spilling into other risk assets as traders sold liquid positions to raise cash. Bitcoin was caught in that unwind, with commentary explicitly pointing to deleveraging in metals feeding through into crypto and equities.

The dollar adds another layer of complexity. Only days ago USD hit its lowest level since early 2022 after President Trump publicly welcomed the weakness, which pushed investors toward traditional havens like gold and the Swiss franc. Since then the tone has shifted again, with the dollar firming as markets reacted to Trump’s intention to nominate Kevin Warsh as the next Fed chair — a development many investors interpret as hawkish relative to expectations and therefore supportive of the dollar at the margin. For crypto, that combination of volatile USD direction and cross-asset deleveraging has kept risk appetite fragile even as pockets of demand emerge on dips.

This is where the equity complex matters, and why this week’s “Tech Week 2.0” is likely to be a key macro input into crypto sentiment. Alphabet and Amazon earnings will act as a high-frequency referendum on whether the AI boom is still accelerating or starting to mature into a more capital-disciplined phase. Alphabet has become a market bellwether for AI optimism, with expectations high after strong narrative momentum around Gemini, chips, and partnerships. Amazon is being judged through a different lens: whether AWS can show a clearer AI-led re-acceleration, and whether heavy data-centre spending is translating into durable operating leverage.

The reason this matters for crypto is straightforward: AI-linked equities remain at the centre of global risk allocation. If the earnings narrative reinforces growth durability and investors are comfortable with the capex burden, it can help stabilise risk appetite and support a recovery in high-beta assets. If it disappoints (especially if capex remains high while growth momentum looks uneven) it reinforces selectivity and keeps markets in a de-risking mindset, which typically weighs most on assets with thinner liquidity and higher volatility.

Taken together, the message is consistent. Crypto’s near-term direction remains driven less by internal fundamentals and more by positioning, liquidity, and the macro risk complex. Bitcoin still sets the tune, and the repeated failure to reclaim and hold above $90,000 is a signal that conviction remains limited. If broader markets stabilise through the week’s macro and earnings catalysts, crypto has room to rebuild. If they don’t, correlation and thin liquidity mean drawdowns can remain sharp and indiscriminate.