Crypto markets have already started the week with a massive dose of volatility following the escalation of trade wars between the United States and the European Union.
Markets are reacting this morning to European retaliation to Donald Trump’s trade tariff announcement over the weekend. Crypto markets have tanked 3% over the past few hours, shedding $115 billion in a fall to $3.21 trillion, largely led by Bitcoin, which fell below $92,000 on some exchanges.
Trump’s announcement of 10% tariffs on eight countries in Europe triggered an emergency meeting of EU leaders on Sunday. French President Emmanuel Macron reportedly asked the bloc to activate its so-called anti-coercion instrument, colloquially known as a “trade bazooka,” which could limit America’s access to European markets.
Adding to the volatility this week are economic reports on GDP and inflation, which could rattle markets further.
Economic Events Jan. 19 to 23
US TradFi markets are closed on Monday for Martin Luther King Jr Day, a national holiday, so there could be a delayed reaction on Tuesday as crypto markets have already tanked.
The heavy-hitting data will be released on Thursday with the third-quarter GDP reports and November’s delayed Personal Consumption Expenditures (PCE) inflation data.
Policymakers will be closely watching the inflation reading this week, following last week’s CPI report showing that inflation continued to cool. The report comes ahead of next week’s Federal Reserve meeting, with central bankers divided over whether to continue to lower interest rates.
Key Events This Week:
1. Stock Market Futures React to Trump’s 10% EU Tariffs – Tonight
2. US Markets Closed, MLK Day – Monday
3. December Pending Home Sales data – Wednesday
4. US Q3 2025 GDP data – Thursday
5. November PCE Inflation data – Thursday
6. January S&P Global…
— The Kobeissi Letter (@KobeissiLetter) January 18, 2026
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In Asia, the focus will be on interest rate decisions from central banks in China on Tuesday and Japan on Friday.
Around 10% of S&P 500 companies report earnings this week, and the World Economic Forum in Davos, Switzerland, also begins this week, so buckle up!
Crypto Market Plunges
Bitcoin has moved in the opposite direction of gold yet again as the asset dumped over $3,500 in a matter of hours in early trading in Asia on Monday.
After a weekend of consolidation around the $95,000 area, BTC slumped almost 3% in a fall to a weekly low of $92,280 and had failed to recover at the time of writing. Ethereum tanked a similar amount, but managed to hold just above the $3,200 price level.
Heavier losses were seen on altcoin markets as usual, with large slides for XRP, Solana, Dogecoin, and Cardano. Only Monero was bucking the trend with a 10% gain on the day to reach $615.
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