Bitcoin's performance since January 1, 2026, has been marked by significant volatility and a modest overall gain amid shifting market sentiments. Starting the year around $87,500–$88,700, BTC quickly rallied in the first two weeks, climbing toward $98,000 by mid-January—the highest level in three months. This surge was fueled by continued institutional inflows into spot ETFs (over $1.9 billion in the first week alone), optimism around pro-crypto policies from the Trump administration, and expectations of regulatory clarity. However, the momentum faded sharply. Macroeconomic pressures, including concerns over U.S. tariffs, inflation readings, and a stronger dollar, triggered a broad risk-off move. By January 20, Bitcoin plunged below $88,000, briefly erasing all 2026 gains as it hit lows near $87,800. Bearish technical signals emerged, with charts showing a potential breakdown from the December–January uptrend and Bollinger Bands indicating low volatility ahead of a possible major move. As of January 22, BTC has staged a partial recovery, trading around $89,800–$90,000, up slightly from the recent bottom but still consolidating in the $92,000–$98,000 range forecasted by many analysts. On-chain data shows increasing long-term holder accumulation, supporting a bullish underlying structure, while sentiment remains cautious. Overall, January 2026 has highlighted Bitcoin's maturing correlation with traditional markets. Despite short-term pullbacks, institutional adoption and supply dynamics post-halving continue to provide long-term support. Traders are watching key levels: a break above $94,500 could resume the uptrend, while failure to hold $88,000 risks deeper correction toward $84,000. The month underscores BTC's transition from retail-driven cycles to institutionally influenced liquidity.