Cryptocurrency prices have fallen significantly in the last 24 hours due to the escalating tensions in the US-China trade war. Investors are pulling out of risky assets as a result.
The US has raised tariffs on Chinese imports to as high as 245% in response to China’s retaliatory actions. The US has also imposed new limits on chip exports.
President Trump has urged China to initiate trade talks, stating that the US does not need a deal. However, China has responded by saying that the US must stop using pressure and threats if it wants to resolve the issue through negotiations.
Bitcoin has dropped over 2% in response to the trade tensions, and the broader cryptocurrency market has dropped 3.75%. Stock markets have also been impacted, with Nasdaq 100 futures falling over 1% and S&P 500 futures dropping 0.65%.
Bitcoin’s recent bull run may be slowing down, as it has dropped below its 200-day simple moving average. This often signals major trend shifts. Coinbase institutional research suggests that this decline marks the start of a new bear market cycle.
According to Coinbase Institutional’s research head, the crypto bull run likely ended in late February. The market has since been moving sideways, neither bullish nor bearish.
Despite the market uncertainties, crypto prices have held up relatively well. Some prime brokers have become more neutral on risk assets, which gives traders more confidence to use protective strategies like hedging.
Key economic data is set to be released this month, including a speech from the Fed Chair. Investors are expecting insights on the next rate cut move. The uncertainty in risk assets has led investors to turn to safer assets like gold, which has seen a 26% increase this year.
Bitcoin is currently consolidating within a channel, and there is a chance it could bounce back and rise toward the middle or top of that range. It remains to be seen if Bitcoin will rise back up or drop further.
Note: Investments carry market risks. Please invest carefully. We do not accept responsibility for any financial losses.
