Bitcoin recovered from near its lowest level in about 10 months on Tuesday, but remained under pressure below the $80,000 mark, after heavy weekend liquidations and uncertainty over US monetary policy weighed on the market.

The world’s largest cryptocurrency was trading up 2.8% at $78,558.4 as of 01:42 ET (06:42 GMT).

Bitcoin had fallen to $74,635.5 over the past 24 hours, its lowest level since early April, as selling accelerated due to a wave of stop-loss triggers and margin calls.

Heavy Liquidations and Trump’s Fed Nominee Weigh on Bitcoin

The sharp weekend decline was driven by widespread forced liquidations of leveraged positions, highlighting the scale of speculative exposure built up during last year’s rally.

Derivatives tracking firms showed that billions of dollars in crypto bets were wiped out within a short period, with long positions accounting for the largest share of forced closures.

Reports indicated that weak liquidity amplified price swings, allowing relatively limited moves to trigger broad liquidation cascades.

Sentiment was also pressured by macro uncertainty, as investors assessed the implications of Kevin Warsh’s nomination to lead the US Federal Reserve, prompting markets to reassess the future path of interest rates.

Warsh is widely seen as leaning toward a more hawkish monetary stance, raising concerns that financial conditions could remain tight for longer.

At the same time, the closely watched January US jobs report was delayed from its scheduled Friday release due to the partial US government shutdown, according to the Bureau of Labor Statistics.

No Agreement on Stablecoin Yields at White House Meeting

Media reports said the crypto industry and major US banks remain divided over how to regulate stablecoin yields, following a White House meeting, underscoring continued obstacles facing long-stalled digital asset legislation.

The meeting included crypto executives, bank representatives, and government officials in Washington to discuss market structure rules, but little progress was made on whether stablecoin issuers should be allowed to offer interest-like returns.

Banks argue that yield-bearing stablecoins could accelerate deposit outflows and pose financial stability risks, while crypto firms say such features are necessary for growth and competitiveness.

Crypto Prices Today: Altcoins Recover, Polygon Jumps

Most alternative cryptocurrencies also posted modest gains on Tuesday.

Ether, the world’s second-largest cryptocurrency, rose 4.6% to $2,325.92.

XRP, the third-largest cryptocurrency, gained 2.1% to $1.61.

Oil prices stabilized on Tuesday after dropping more than 4% in the previous session, as market participants assessed global supply prospects and the possibility of easing tensions between the United States and Iran.

Brent crude futures rose by 17 cents to $66.47 per barrel by 12:17 GMT, while US West Texas Intermediate crude gained 24 cents to $62.38 per barrel. Earlier in the session, both Brent and WTI fell to $65.19 and $61.12 per barrel respectively, their lowest levels in a week.

Russian Deputy Prime Minister Alexander Novak said on Tuesday that the global oil market is currently balanced, noting that demand is expected to gradually increase in March and April, in response to a question about OPEC+ production policy plans. The Organization of the Petroleum Exporting Countries and its allies, including Russia, agreed at a meeting on Sunday to keep oil production levels unchanged for March.

Novak added that Russia has sufficient fuel supplies and is even running a surplus.

Oil prices had dropped more than 4% on Monday after US President Donald Trump said Iran was “talking seriously” with Washington, signaling a potential easing of tensions with the OPEC member.

Officials from both sides told Reuters on Monday that Iran and the United States are expected to resume nuclear talks on Friday in Turkey. Trump warned that “bad things could happen” if no agreement is reached, as large US warships head toward Iran.

In this context, Iranian President Masoud Pezeshkian wrote on X on Tuesday that pursuing talks with the United States should aim to secure Iran’s national interests, provided that “threats and unreasonable expectations” are avoided.

Kelvin Wong, senior market analyst at OANDA, said that oil’s volatile price moves over the past four weeks were driven by a geopolitical risk premium tied to the current US administration’s expansionary foreign policy, particularly intermittent threats toward Iran.

Also weighing on prices, the US dollar index held near its highest level in more than a week. A stronger dollar tends to curb demand for dollar-priced oil from buyers outside the United States.

On Monday, Trump announced an agreement with India to cut US tariffs on Indian goods to 18% from 50%, in exchange for India halting purchases of Russian oil and reducing trade barriers.

ING analysts said in a note: The United States and India agreed overnight on a trade deal. If implemented, this would lead to additional volumes of Russian oil remaining afloat at sea.

Trump announced the deal on social media after a phone call with Indian Prime Minister Narendra Modi, saying India agreed to buy oil from the United States and possibly from Venezuela as well.

Analysts at Cavendish said in a research note that rapid shifts in financial flows have amplified oil price movements since the start of the year, adding that traders began the year with large short positions that were quickly reversed after weeks of geopolitical disruptions.

The US dollar traded broadly steady on Tuesday, as positive economic data and shifting expectations for Federal Reserve monetary policy outweighed concerns about the possibility of another US government shutdown.

The US Dollar Index, which measures the currency against a basket of peers, held relatively stable at 97.53 after rising 1.5% over the past two days. The euro rose 0.12% to $1.1804.

The dollar had gained stronger momentum in recent days after the nomination of Kevin Warsh to lead the Federal Reserve, as markets generally expect him to be less inclined toward pushing for rapid rate cuts compared with other potential candidates.

Rate Cut Expectations Remain in Place

Lee Hardman, senior currency analyst at MUFG, said Warsh’s nomination sent a signal that US President Donald Trump is not seeking to undermine the Fed’s independence in setting monetary policy. However, he added that Warsh is still likely to support lower interest rates, at least in the initial phase.

He said, “We believe that once the dust settles, the dollar will return to weakening, and we expect EUR/USD to move back above 1.20 later this year, as the Fed begins cutting rates while the European Central Bank keeps rates unchanged.”

Meanwhile, US manufacturing data showed activity returning to growth, with the ISM reporting on Monday that the manufacturing PMI rose to 52.6 last month, the highest level since August 2022.

However, the closely watched US January jobs report will not be released this week due to the partial federal government shutdown.

Elsewhere, geopolitical tensions eased after the United States reached a trade agreement with India and announced the resumption of nuclear talks with Iran.

Australian Dollar Jumps

The Australian dollar surged after the Reserve Bank of Australia delivered its first interest rate hike in two years, raising the benchmark rate by 25 basis points to 3.85%. The bank also warned about inflation risks, reinforcing bets on at least one additional hike this year.

The Australian dollar rose 0.96% to $0.7014, and climbed more than 1.5% against the Japanese yen to 109.48, its highest level versus the yen since 1990.

Both the European Central Bank and the Bank of England are expected to keep interest rates unchanged at their meetings on Thursday. Markets will closely watch any signals from the ECB on whether the euro’s recent strength could influence future policy direction.

Later this week, attention will turn to Japan’s lower house elections.

Investors have been selling the Japanese yen and government bonds ahead of the February 8 vote, on bets that a strong result for Prime Minister Sanae Takaichi’s party would give it greater room to expand fiscal stimulus.

The yen received some support last week after Japanese policymakers hinted at possible coordination with the United States on joint action to defend the currency.

The dollar was steady against the yen at 155.67, down from a one-and-a-half-year high of 159.45 reached in mid-January.

Matthew Ryan, head of market strategy at Ebury, said, “The outcome of this week’s election will be crucial, as a strong showing by Takaichi could push the yen back toward the 160 level.”

Finance Minister Satsuki Katayama on Tuesday defended Takaichi’s recent remarks highlighting the benefits of a weaker yen, saying the prime minister was referring to “what is written in textbooks.”

Gold prices rose by more than 6% in European trading on Tuesday, beginning a rebound from a four-week low, after a sharp three-day selloff driven by a historic wave of liquidation across precious metals. The recovery is also supported by a pause in the US dollar’s advance in the foreign exchange market.

Starting today, traders are closely watching the release of several very important US labor market reports, which are expected to provide strong clues about the Federal Reserve’s interest rate path over the course of this year.

Price Overview

• Gold prices today: Gold rose by 6.2% to $4,949.81, up from the session opening level at $4,660.63, and recorded a session low at $4,660.63.

• At Monday’s settlement, the precious metal gold fell by 4.75%, marking its third consecutive daily loss, and hit a four-week low at $4,402.83 per ounce.

• In addition to accelerated profit-taking from the all-time high at $5,598.13 per ounce, the gold market entered a historic selloff after concerns about Federal Reserve independence eased, and after CME Group raised margin requirements on gold and silver futures.

The US Dollar

The US Dollar Index fell by 0.2% on Tuesday, pulling back from a two-week high at 97.73 points, reflecting a halt in the dollar’s gains against a basket of major and minor currencies.

Beyond profit-taking, the dollar is edging lower as investors refrain from building new long positions while waiting for clearer signals on the future path of US interest rates.

US Interest Rates

• According to the CME FedWatch tool, pricing for keeping US interest rates unchanged at the March meeting stands at 85%, while the probability of a 25-basis-point rate cut is priced at 15%.

• To reprice those expectations, traders are closely monitoring a series of very important US labor market data releases.

• Later today, US job openings data for the end of last November will be released, followed on Wednesday by private-sector payrolls data for January, and on Thursday by weekly jobless claims.

Gold Outlook

Deutsche Bank analysts said that history suggests short-term drivers are usually behind moves of this kind, even if the scale of the recent selloff has raised fresh questions about market positioning.

The bank’s analysts explained that although speculative activity indicators have been elevated for months, they are not sufficient on their own to explain the magnitude of last week’s move.

They added that the correction in precious metals prices exceeded the apparent catalysts, and that it is unlikely investor intentions toward precious metals — whether official, institutional, or retail — have fundamentally turned more negative.

Deutsche Bank noted that the selloff resulted from a mix of factors, including a rebound in the US dollar, shifting expectations about Federal Reserve leadership after President Donald Trump nominated Kevin Warsh to head the Fed, and position trimming ahead of the weekend.

Xavier Wong, market analyst at eToro, said speculative positioning clearly played a short-term role. He added that silver attracted greater retail participation than gold, making it more sensitive to fast shifts in sentiment and short-term trading flows.

SPDR Fund

Gold holdings at SPDR Gold Trust, the world’s largest gold-backed ETF, were unchanged on Monday, keeping the total at 1,087.10 metric tons.