Bitcoin (BTC) is down by 1.3% to $77,570 this
week, rebounding from a steep 5.5% drop on Monday that saw prices plunge to
$74,464. Despite extreme turbulence in global markets, the flagship
cryptocurrency has shown surprising resilience, losing 8.5% since April 2’s
“Liberation Day” declaration by U.S. President Donald Trump. In contrast, the S&P
500 index has dropped by 11.4% over the same period.
Crypto enthusiasts have taken Bitcoin’s
performance as a sign of its evolving role as a safe haven asset amid rising
global risks. However, historical data paints a more nuanced picture. During
the U.S.–China trade war in 2018, BTC declined by 73%, only to surge by 230% in
April 2019 when tensions eased and the Federal Reserve began cutting rates.
This suggests Bitcoin is more likely to benefit from easing geopolitical
pressure and monetary stimulus, rather than trade war escalations.
This week, Trump intensified trade tensions
further by slapping a staggering 104% total tariff on Chinese imports after
Beijing refused to roll back its reciprocal 34% duties. The fallout was
immediate. China began offloading U.S. Treasuries, pushing the yield on 10-year
bonds from 4.05% to 4.46% during Asian trading hours on Wednesday. Chinese
Foreign Ministry Spokesperson Lin Jian declared that the U.S. is unwilling to
negotiate without pressure tactics and warned of “resolute and forceful”
countermeasures.
Both economies appear to be walking into a
deadlock with potentially devastating global consequences. If tariffs aren’t
scaled back to a more sustainable 10–20% range, both the U.S. and Chinese
economies may suffer long-term setbacks. China, which hasn’t recorded a GDP
contraction in five decades, and the U.S., heavily reliant on Chinese goods,
may be facing years of disruption. Trump’s strategy could either trigger
further escalation—or force a retreat.
This fragile backdrop could see the Federal
Reserve step in with stimulus if U.S. markets deteriorate further. In that
scenario, Bitcoin and broader crypto assets may see renewed inflows. Notably,
large investors appear to be holding their ground. Spot Bitcoin ETFs—BlackRock’s
IBIT, Fidelity’s FBTC, and Grayscale’s GBTC—reported modest net outflows of
$168.7 million last week and just $25.1 million this week, despite the spike in
volatility.
From a technical standpoint, Bitcoin has
bounced from the support range at $72,000–$74,000 and is now testing resistance
at $81,000–$83,000. A break above this level could set the stage for a retest
of the critical $89,000–$91,000 zone. If that resistance is surpassed, the door
could open for a powerful rally toward the $150,000–$200,000 range.