Cointelegraph recently explored whether Bitcoin’s (BTC) price is poised for another downfall. After a swift recovery from a five-month low of $74,300, BTC surged to hit $83,565 on April 9. However, the subsequent rejection from the $83,500 mark has led to speculation about BTC’s ability to sustain the $80,000 zone.
President Trump’s recent decision to postpone proposed tariff increases for 90 days could potentially influence a BTC trend reversal. This decision, made on April 9, also introduced a reciprocal 10% tariff on all countries excluding China. Despite this gesture of goodwill, Trump also escalated the trade war with China by increasing tariffs on Chinese imports to the US by 125%, citing their lack of “respect for world markets.” This action initiated a significant market rally, with Bitcoin rising over 7% to $82,000 as investor anxiety was alleviated.
However, China’s retaliatory tariffs of 84% on US imports, effective from April 10, hint at an intensifying conflict. If talks fall through and the US-China trade war worsens post the 90-day hiatus, Bitcoin may experience another dip as markets recoil from the uncertainty.
Inflation fears and possible recessions are also contributing to Bitcoin’s potential downfall. Bitcoin has shown an increasing correlation with tech stocks and the overall market sentiment, experiencing sharp dips during periods of market unrest. For instance, Bitcoin suffered a nearly 10% dip from its highs earlier this year, slipping below $80,000, when Trump’s initial tariff announcements caused a stock sell-off.
Experts suggest that if trade tensions escalate further or central banks tighten monetary policy to counteract inflation, investors may abandon risky assets like Bitcoin, causing its price to drop. This implies that an unexpected economic shock, such as a Federal Reserve rate hike or a global growth slowdown, could trigger another crash, particularly if Bitcoin fails to break its current trading range of $80,000-$90,000.
Traders are currently watching the April 10 CPI data closely, which could shift the focus back onto the domestic economy. A weaker print would be advantageous, helping to offset the inflationary influence introduced by the blanket tariff policy.
Although one Federal Reserve meeting is scheduled in the interim, interest rates are unlikely to decrease before June. The chances of the Fed keeping interest rates unchanged at the May 7 meeting are 81.5%. If crucial price levels do not hold, this could further dampen Bitcoin’s appeal and potentially push its price down even more.
From a technical standpoint, important Bitcoin levels to observe include the 111-day moving average (MA) at $93,000, the 200-day MA at $87,000, and the 365-day MA at $76,000. As highlighted in Glassnode’s latest Week’s On-chain report, the price must now hold above the 365-day MA to avoid another downturn.
If Bitcoin fails to hold above $80,000, it could be on a downward trajectory again. In such a scenario, critical levels to observe below the 365-day EMA include the active realized price at $71,000 and, in extreme cases, the true market mean of around $65,000. If the tariff wars and stock market unrest persist, Bitcoin risks another dip to five-month lows at $71,000.
Reminder: This article does not provide investment advice or recommendations. Every investment and trading move involves risk, and readers should conduct their own research before making a decision.
