BTCUSD Bitcoin

Bitcoin (BTC) price bounced quickly from its five-month low of $74,300 to reach $83,565 on April 9, but the rejection from the $83,500 level raises questions about whether BTC will be able to hold the $80,000 zone.

BTC/USD daily chart. Source: Cointelegraph/TradingView

Will Trump’s 90-day tariff pause create a BTC trend reversal?

On April 9, US President Donald Trump authorized a 90-day pause on proposed tariff hikes while introducing a blanket 10% reciprocal tariff on all countries except China. In contrast to his broader olive branch, Trump doubled down on his trade war with China, escalating tariffs on Chinese imports to the US to 125%, citing Beijing's lack of "respect for world markets." 

This move triggered a historic market rally, with Bitcoin surging over 7% to $82,000 as investor nerves eased. The pause offers temporary relief, reducing immediate trade war fears that had previously tanked risk assets. 

However, China’s retaliatory 84% tariffs on US imports, effective April 10, signal an escalating standoff. If negotiations fail and the US-China trade war deepens after the 90-day window, Bitcoin could face renewed downward pressure as markets recoil from heightened uncertainty. 

“With China singled out so explicitly, market participants are bracing for Beijing's counterpunch,” trading firm QCP Capital wrote in a Telegram note to investors. 

QCP Capital added: 

“Should retaliation materialize in force, the exuberant rally could quickly morph into a classic bull trap.”

While the pause buys time, its ability to prevent a crash hinges on whether Trump can de-escalate tensions with China—a tall order, given his aggressive rhetoric.

Inflationary pressures could weigh down BTC price

Another factor adding to Bitcoin price headwinds is macroeconomic factors like inflation fears and potential recessions. 

Bitcoin has increasingly correlated with tech stocks and broader market sentiment, as seen in its sharp declines during periods of market turmoil. For instance, when Trump’s initial tariff announcements triggered a sell-off in equities, Bitcoin dropped nearly 10% from its highs earlier this year, slipping below $80,000. 

Analysts argue that if trade tensions escalate further or central banks tighten monetary policy to combat inflation, investors may flee risk assets like Bitcoin, pushing its price lower. 

This sensitivity to macroeconomic shifts suggests that any sudden economic shock—like a Federal Reserve rate hike or a global growth slowdown—could spark another crash, especially if Bitcoin fails to break its current trading range of $80,000-$90,000.

Market participants now shift their focus on the April 10 CPI data, which is poised to refocus attention on the domestic economy. 

“A weaker print would be welcome,” QCP capital said, adding that it would help to “offset the inflationary overhang introduced by the blanket tariff policy.”

Lowering interest rates is unlikely before June, despite one Fed meeting scheduled in the interim, according to CME Group’s FedWatch Tool.

Fed target rate probabilities for the May 7 FOMC meeting. Source: CME Group

The odds of the Fed keeping interest rates unchanged at the May 7 meeting are 81.5%. 

This could further dampen enthusiasm for BTC and push its price lower if key price levels do not hold.

Related: Bitcoin price soars to $83.5K — Have pro BTC traders turned bullish?

Key Bitcoin levels to watch

Bitcoin breached the $75,000 level on April 8 before retracing to the current levels. Traders are now focused on key areas around this level and the $109,000 peak, which the BTC price might revisit in the near future.

From a technical perspective, key Bitcoin levels to watch are the 111-day moving average (MA) at $93,000, the 200-day MA at $87,000 and the 365-day MA at $76,000, according to market intelligence firm Glassnode.

In its latest Week's On-chain report from Glassnode highlights that after losing the 111-day MA and the 200-day MA in the recent drawdowns, the price must now hold above the 365-day MA to avoid another crash.

“This is a key momentum level that has thus far held as support but needs to remain as support to avoid further downside momentum from being established.” 

Bitcoin: Technical levels to watch. Source: Glassnode

Another level to watch, according to Glassnode, is the short-term holder (STH) cost basis at $93,000 (coinciding with the 111-day MA), which, if reclaimed, would signal the first sign of strengthening momentum.

However, if Bitcoin fails to hold above $80,000, it will embark on another downward path. Key levels to watch below the 365-day EMA are the active realized price at $71,000 and, in dire cases, the true market mean of around $65,000.

“We now have confluence across several onchain price models, highlighting the $65k to $71k price range as a critical area of interest for the bulls to establish long-term support”

Bitcoin: True market mean. Source: Glassnode

As earlier reported by Cointelegraph, Bitcoin risks another sweep of the five-month lows at $71,000 if the tariff wars and stock market tumult continue. 

This article does not contain investment advice or recommendations. Every investment and trading move involves risk, and readers should conduct their own research when making a decision.

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