Bitcoin’s price fell more than 2% on Sunday, dropping to $83,482 in Asia trading hours. This decline mostly undid the previous week’s progress, with Bitcoin missing out on the bull run of the equity markets. The fall came alongside erratic and confusing signals from the Trump administration on whether potential tariffs on Chinese-made electronics were in the cards.
In early trading, Nasdaq 100 futures jumped over 1% and S&P 500 futures rose 0.7%. At the same time, cryptocurrency investors reacted sharply to the tariff-related news. Ethereum was affected as it dropped below $1,600, and altcoins experienced a mixed performance, per CoinGecko data.
Tariff Uncertainty Weighs on Market
The root of the market’s anxiety has come from mixed messages on tariffs. Additionally, Secretary of Commerce Howard Lutnick reaffirmed that additional sector-specific tariffs on electronics would be imposed in the coming two months.
President Trump only deepened the confusion when he took to Truth Social to claim victory on the issue. To be clear, he said, some electronics are currently excluded from the new 10% “reciprocal” tariff regime. He later announced that those same products would be subject to a separate 20% levy nonetheless. This new levy is surely tied to the national security narrative, intermingling with worries of fentanyl enforcement.
"NOBODY is getting ‘off the hook’ for the unfair trade balances, and non-monetary tariff barriers, that other countries have used against us, especially not China, which, by far, treats us the worst!" - Donald Trump
The confused signals played havoc in the market, producing a crypto sell-off that saw Bitcoin and other cryptocurrencies crash.
Reversal of Recent Gains
The price action represents a complete 180-degree shift from the quiet, relative stability seen earlier in the week. Traders had been trying to get ahead of upside, buoyed by strong Fed signals indicating that inflation was finally starting to head in the right direction.
With further monetary easing came new optimism and hope in the crypto world. Those shiny, bright skies have been clouded by a return of tariff worries. Before today’s announcement, the market was already fully pricing in an emergency Federal Reserve rate cut—possibly as soon as the next meeting in May.
"Anticipation has dampened for an emergency rate cut ahead of the next Fed meeting in May (and for a rate cut before the June Fed meeting), with medium-term inflationary effects from the Trump administration tariffs now expected to keep Powell from cutting before June" - Darren Chu
Key Levels to Watch
Market observers are understandably focused on what’s happening with Bitcoin’s key levels. They have pointed out that $81,000 would make a good support benchmark. A breach below this level would be an early indication of downside risk. The cryptocurrency market remains sensitive to macroeconomic factors, and the ongoing trade developments will likely continue to influence price movements in the near term.
