Bitcoin Price Analysis: BTC Registers Sharp Decline As April Tariff Fears Spook Markets

Bitcoin (BTC) registered a sharp decline as the crypto market turned bearish. The flagship cryptocurrency is down almost 3% over the past 24 hours. Analysts believe BTC may stay in a consolidation phase, casting doubt on whether liquidity growth alone can drive a rally. 

BTC’s price action suggests indecisiveness among traders as it struggles to overcome persistent resistance between $88,000 and $90,000. The daily chart shows the formation of a small rising wedge pattern, with two growing and converging trendlines, indicating a bearish breakdown could be on the horizon. 

Positive Discussions Around Bitcoin As A Reserve Asset 

Discussions around a potential strategic Bitcoin reserve in Brazil have been positive, with officials calling for a deeper discussion regarding BTC’s role as a reserve asset. While President Luiz Inacio Lula da Silva is not involved in the matter yet, the proposal is being considered by some of the highest offices of Brazil’s political establishment. According to media reports, Pedro Giocondo Guerra, Chief of Staff of Vice President Geraldo Alckmin, believes BTC could become part of Brazil’s foreign reserves. Guerra spoke at the recent inauguration of the Parliamentary Front for a Competitive Brazil, stating, 

“Debating rigorously the creation of a sovereign reserve of bitcoin value is in the public interest and will be crucial to our prosperity. After all, bitcoin is digital gold, the internet’s gold.”

He also spoke highly about Bitcoin’s traits, including its ability as a transactional tool and a store of value. 

“It is a technology that allows us to transfer wealth from one end of the planet to the other with agility and store the fruits of our labor efficiently and securely.”

Bitcoin (BTC) Risks Another Drop 

Analysts at Nansen believe Bitcoin and the wider crypto market could see another substantial drop thanks to uncertainty surrounding tariffs and US trade policy, which could lead to volatility. The analysts believe there is a 70% likelihood of a price dip in the weeks after April 2. Aurelie Barthere, principal research analyst at Nansen, believes the market could stabilize after a brief correction following the April 2 tariffs. 

“In my main scenario, 70% subjective likelihood, I expect another leg down in crypto prices after April 2 after we reached a local bottom in mid-March. After this second correction, I expect we will be bottoming for the rest of the year (continuation of the bull market and revisit of the ATHs for BTC).”

Market Is Underestimating Bitcoin’s Potential For New ATH

A crypto analyst has said that the market is underestimating how quickly Bitcoin (BTC) can reach a new all-time high, adding that they expected the flagship cryptocurrency to surge past $109,000 sooner rather than later despite adverse macroeconomic conditions. The analyst stated, 

“The market may be underestimating how quickly Bitcoin could surge – potentially hitting new all-time highs before Q2 is out.”

They also said the forecast stands regardless of whether or not there is clarity on President Trump’s tariff policies or potential recession concerns. BTC dipped below $100,000 at the beginning of February, with analysts blaming the downturn on US President Donald Trump’s tariffs and uncertainty over US interest rates. The analyst’s prediction is based on easing financial conditions, a weakening US Dollar and the People’s Bank of China ramping up market liquidity. 

“Financial conditions have eased dramatically this month, highlighted by the US dollar’s third-largest three-day decline since 2015 and significant drops in rates and Treasury bond volatility. Liquidity remains central to investing in all asset classes.”

Bitcoin (BTC) Price Analysis 

Bitcoin (BTC) has taken a bearish turn since Wednesday after failing to move past the resistance at $88,000. Selling pressure has intensified during the ongoing session, with the flagship cryptocurrency down over 3%, slipping below $85,000, as sellers look to drive it lower. Analysts from Matrixport believe BTC may stay in consolidation, believing the flagship cryptocurrency’s next breakout will require more than just liquidity growth. The analysts noted that when central banks expand money supply, some of the liquidity makes its way to the crypto market. However, they also cautioned it does not guarantee higher prices for BTC or any other digital asset. 

“While a lag between money supply growth and Bitcoin’s price action may exist, there is no strong theoretical basis for why this should consistently be 13 weeks — the timeframe that currently offers the best visual correlation.”

The analysts also warned that comparing BTC’s price with global liquidity could be misleading since both time series are “non-stationary” and can distort correlation analysis, leading to inaccurate results. According to Matrixport, BTC could continue moving sideways without a clear catalyst in sight. 

BTC had embarked on a steady upward trajectory since March 11, when it dropped to a low of $76,642, reclaiming $80,000. The flagship cryptocurrency moved past the 20 and 200-day SMAs on Wednesday after an increase of over 5% and settled at $86,678 as bullish sentiment took hold. However, the rally was short-lived as BTC was back in the red on Thursday, dropping over 3%, slipping below the 20 and 200-day SMAs and settling at $84,215. Price action remained bearish on Friday and Saturday as BTC registered marginal declines and settled at $83,822. Sentiment changed on Sunday as the price rallied almost 3% and settled at $86,116.

Source: TradingView

BTC raced to an intraday high of $88,839 on Monday. However, it could not stay at this level and settled at $87,523, ultimately registering an increase of 1.63%. BTC lost momentum on Tuesday as selling pressure and volatility increased, registering a marginal decline and settling at $87,417. Sellers retained control on Wednesday as the price dropped 0.54% to $86,942. BTC registered a marginal increase Thursday to reclaim $87,000 and settle at $87,236. However, bearish sentiment returned during the current session. As a result, BTC is down almost 4%, falling below the 20 and 200-day SMAs and trading at $83,889. If BTC continues to decline, it could drop to $80,000. A break below this level could drive the price down to $78,000. On the other hand, buyers will look to regain control and push the price above $90,000. A break past this level could see BTC push towards $100,000.

Disclaimer: This article is provided for informational purposes only. It is not offered or intended to be used as legal, tax, investment, financial, or other advice.