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Trump Tariff May Crash Bitcoin Toward $50,000
In a shocking turn of events, the market has reacted sharply to US President Donald Trump’s announcement of a 10% universal import tariff. The drastic measure, intended to protect U.S. industries, has sparked concerns about a prolonged trade war and global economic slowdown.
As a result, markets have been spooked, with S&P 500 and Nasdaq 100 futures plummeting over 4%. Meanwhile, Dow Jones futures have dropped more than 1,000 points, as investors scramble to reassess the new macroeconomic landscape. Bitcoin has also taken a hit, briefly surging to $87,000 before retracting back down to its current price of around $83,000.
Bitcoin’s chart reveals that it is now trading near its 50-week Exponential Moving Average (EMA) at $76,619. This critical level has served as support since early 2023, but the current price is hovering just above this key zone. Should Bitcoin close below this EMA, it could plummet towards the 200-week EMA near $45,623, marking a staggering decline of approximately 40% from its current value.
Furthermore, the Relative Strength Index (RSI) has turned bearish, with an RSI reading of 47.79 falling beneath the neutral 50 line. This shift in momentum underscores the increasing risks facing Bitcoin investors. As long as the RSI remains below this threshold, the price may continue to fall.
The announcement of sweeping tariffs has also heightened recession concerns, with prediction platforms like Polymarket and Kalshi now indicating a probability of over 50% for an economic downturn in 2025 – a significant increase from under 20% at the start of the year. Bitcoin faces the risk of being hit particularly hard amid tariff-induced market sell-off and global uncertainty.
While some analysts argue that a recession could ultimately strengthen U.S. market dominance, other experts warn about the perils of stagflation reminiscent of the 1970s, should the global economy falter. This uncertainty has led to a heightened sense of risk aversion among investors, who often flee from volatile assets like Bitcoin during times of economic turmoil.
Given these unprecedented market conditions, it’s increasingly likely that Bitcoin will experience a significant correction.
Source: https://coinchapter.com/trump-tariff-may-crash-bitcoin-toward-50000/?utm_source=rss&utm_medium=rss&utm_campaign=trump-tariff-may-crash-bitcoin-toward-50000
