BTC/USD nearly doubled in value to hit $85,379. This increase came on the heels of news of potential tariff relief on critical tech imports from the US-China trade war. Lowering tariffs would help alleviate cost-push inflationary pressure on the prices of those imports. Such a development could strengthen market expectations for a Federal Reserve rate cut by June. Here are 7 crucial factors that will determine the cryptocurrency’s path towards $100,000. These factors consist of trade developments, macroeconomic indicators, the state of the Bitcoin Act and ETF flows.
Bitcoin's Weekend Surge
Price action Bitcoin (BTC) continued to show robust bullish strength on BTC price adding 2.41% on Saturday, April 12. This came after a strong 4.75% surge on Friday, closing the day just shy of $85,379. Optimism that the administration would deliver tariff relief on tech imports contributed heavily to that spike. This kind of relief would have a ripple effect on the economy at large.
A clear break above $90,742 would open the door to the psychological $100,000 hurdle, potentially confirming more bullish momentum ahead. A decline beneath $85,000 might bring support at $80,000 into play. A drop again underneath $80,000 would open the March 11 low at $76,642.
"Trump’s weekend tariff exemptions have led to an instant crypto market rise. The tech sector is much less impacted by high import costs compared to 24 hours ago, and Bitcoin has already hit a high of $85.9K." - Santiment
ETF Flows Present Mixed Signals
Bitcoin’s price received a enormous increase, but after the fourth launch, the US BTC-spot ETF marketplace suffered historic losses. It saw total net outflows of $707.9 million, on top of $165 million in outflows last week. Grayscale Bitcoin Mini Trust (BTC) bucked the trend as the only one of the individual ETFs with inflows — $2.4 million.
Other major ETFs experienced outflows. Fidelity Wise Origin Bitcoin Fund (FBTC) experienced net outflows of $74.6 million. At the same time, iShares Bitcoin Trust (IBIT) saw the biggest net outflows since launch, at $342.6 million. Grayscale Bitcoin Trust (GBTC) had the largest net outflows at $160.9 million.
The conflicting ETF flows indicate a level of investor confusion and/or uncertainty, in spite of the great price action. This may be due to a combination of profit-taking, macroeconomic fears, and regulatory news.
Factors Influencing Bitcoin's Trajectory
Bitcoin’s short-term trajectory depends on a few important factors. Among other things are the continued trade tensions between the US and China, which can have strong ripple effects on global economic conditions. Home and macroeconomic indicators, such as inflation trends and employment data will play a huge role on investor sentiment. They’re going to set the tone for the Federal Reserve’s own monetary policy decisions.
The Bitcoin Act Its getting through and long overdue. The country needs a comprehensive legal framework for cryptocurrencies. This new development would be a major market game-changer. Bitcoin ETF flows in and out are a key barometer. It helps them show the amount of demand they are receiving from their institutional investor base.
The Federal Reserve will likely need to get a bit more dovish and start leaning towards cutting interest rates. The new shift has the potential to increase risk appetite which will further support Bitcoin. The cryptocurrency's path to $100,000 remains challenged by US-China trade uncertainties, recession risks, Federal Reserve policy uncertainty, and pending legislation.
