Bitcoin tumbles below $82k as global markets grapple with impending ‘Liberation Day’

Bitcoin is starting the week around $81,800, marking a 1.98% decrease over the past 24 hours and continuing a weeklong downtrend that has seen the asset fall over 7% from its March 25 local peak of $88,400.The sustained decline has triggered roughly $220 million in liquidated crypto positions, extending Bitcoin’s streak of lower lows to a seventh consecutive day.The pullback coincides with widespread losses across the broader digital asset market. The global crypto market capitalization has dropped to $2.65 trillion, a 1.77% decrease over the same 24-hour period, and daily trading volume has fallen by 1.4% to $57 billion.Macroeconomic Stress and Tariff Uncertainty Erode Market ConfidenceMounting anxiety ahead of former President Donald Trump’s “Liberation Day” on April 2, during which he is expected to unveil sweeping “reciprocal tariffs,” has added pressure to crypto and traditional financial markets. The anticipation of aggressive trade measures has triggered a derisking trend across spot markets, reducing demand and increasing investor hesitation.Multiple negative macroeconomic signals are contributing to the unease. Core PCE data released last week pointed to higher-than-expected inflation, while consumer confidence has declined to its lowest level in over a decade. Meanwhile, Goldman Sachs raised its recession forecast from 20 percent to 35 percent, citing elevated geopolitical and economic risk.Bitcoin’s decline has mirrored losses across equity markets, reinforcing its correlation with traditional risk assets. The S&P 500 has declined by over 6% this month, while the Nasdaq and Dow Jones Industrial Average are down 9% and 4.7%, respectively.Bitcoin has now declined 13% in the first quarter of 2025, the asset’s worst quarterly performance in two cycles. The correction comes as gold climbs to all-time highs, surpassing $3,087, indicating a complete decoupling of assets.‘Liberation Day’ Set to Test Market ResilienceThe upcoming tariff announcement will likely be a key inflection point for crypto and broader financial markets. Trump’s April 2 “Liberation Day” promises tariff hikes designed to reduce U.S. dependence on foreign goods, with targets including the European Union, South Korea, Brazil, and India, as CNBC reported.Goldman Sachs projects these duties could raise inflation and unemployment while stalling economic growth. Their forecast includes a potential increase in tariff rates by 15 percentage points, though carveouts for certain products and countries could reduce the effective increase to 9 percentage points. According to Reuters, the immediate market impact will depend on the breadth and timeline of tariff implementation, particularly whether other nations respond in kind.If retaliation occurs, it could initiate a feedback loop of escalating trade restrictions, likely increasing market volatility. Analysts view the coming days as critical for assessing resilient investor sentiment in the face of potential policy shocks and persistent macro headwinds.Bitcoin Faces Technical and Sentiment-Driven HeadwindsTechnical patterns for Bitcoin suggest further downside risk, with price action nearing a key support level. The asset is testing levels that, if broken, could accelerate the pace of liquidation and open the door for short-term bearish continuation.Bitcoin channels (Source: TradingView)Bitcoin has repeatedly failed to maintain the purple price channel, falling back into the green channel, the last historical channel before the potential bottom channel for the cycle at $73,000.While some analysts anticipate that Bitcoin could benefit from long-term inflationary pressures triggered by tariffs, that narrative remains speculative and disconnected from the immediate sell-off. For now, traders appear more focused on capital preservation amid unclear macro signals and escalating geopolitical risk.



Source link