Bitcoin (BTC) experienced a notable decrease in value, cooling off after a 7% rebound that began on March 11, coinciding with the reopening of Wall Street. The market has faced renewed concerns, primarily stemming from the announcement of additional trade tariffs on Canada by U.S. President Donald Trump, causing a ripple effect across various risk assets.
On March 11, Bitcoin reached local highs of $82,154 on the Bitstamp exchange. However, as data indicated slight overshoots in U.S. job openings, the impending tariffs dampened the market’s optimism. This sentiment shift also adversely affected traditional stock markets, with the S&P 500 trading down by 0.5% on the same day.
Impact of Tariffs on Market Sentiment
According to trading experts, such as those from The Kobeissi Letter, the performance of the S&P 500 has drastically changed compared to earlier in Trump’s tenure, with a current decrease of 7% since January 20th, contrasting with the 5% increase observed during the same period previously. This scenario illustrates a significant change in investor sentiment.
“A polar opposite start to his term so far,” was how The Kobeissi Letter phrased the market’s reaction to Trump’s policies.
Market analysis by QCP Capital highlights the challenges posed by Trump’s apparent disregard for potential recession risks, contributing to a difficult environment for risk assets. Nonetheless, they noted that not all market signals were negative—specifically, the fall of 10-year Treasury yields by approximately 60 basis points and a weakening U.S. dollar could be advantageous for USD-denominated assets, including cryptocurrencies.
Potential for New Bitcoin Price Lows
As Bitcoin navigates through this turbulent landscape, the coin finds itself at a critical juncture, lacking clear catalysts for upward movement. Technical analysis using Elliott Wave theory has identified essential support and resistance levels, with forecasts suggesting that Bitcoin could test new long-term lows unless significant resistance is overcome.
“A confirmed low needs a sustained break above yesterday’s high in 5 waves. The market, as always, enjoys keeping traders guessing.”
Notable trader CrypNuevo has indicated a favorable response around the 50-week simple moving average (SMA) positioned near $75,500, which has yet to see a candle close below since March 2023. This trendline could serve as a pivotal reference point as Bitcoin attempts to stabilize in the wake of unfavorable market conditions.
As we proceed, investors and traders alike are urged to remain vigilant and conduct their research in light of the ongoing volatility. This article does not offer investment advice; all trading activities involve inherent risks, and it is essential for individuals to stay informed and assess their strategies carefully.
