Bitcoin Rebounds as Trade War Escalates: Decoupling from Stocks?
Bitcoin bounced back by 2.3% on Friday, reclaiming the $84,100 level after China imposed a 34% tariff on U.S. imports.
This move comes just two days after former President Donald Trump announced new tariffs on Chinese goods and several other countries, intensifying concerns of a prolonged trade dispute and sending traditional markets into turbulence.
Despite the growing economic uncertainty, Bitcoin showed resilience compared to U.S. stocks, which took a hit during the same period. The cryptocurrency briefly dipped to $81,600 but quickly recovered, while the S&P 500 fell by 6% throughout the week. This divergence hints at a potential shift in investor behavior, with Bitcoin appearing less correlated to traditional equities than before.
Analysts suggest that Bitcoin’s recent price action might indicate a growing appetite for risk among investors, especially as it remains stable above the $82,000 mark. Michael Hartnett from Bank of America believes that Bitcoin’s ability to hold this level could attract hedge demand, especially if global market volatility persists.
Technical indicators show that Bitcoin could be on the verge of a breakout if it surpasses the $85,000 resistance. Bollinger Bands point to a narrowing range, suggesting potential upward momentum if buying pressure continues. The Relative Strength Index (RSI) hovers near 47.22, reflecting neutral sentiment but hinting at a possible move higher if it crosses the 50 mark.
Investors are watching closely, as maintaining support at $81,000 is crucial. A failure to do so might trigger significant liquidations, potentially dragging the price down. However, if Bitcoin manages to sustain this level, it could strengthen its position as a hedge amid economic tension, possibly leading to a rally towards $88,000.
Alexander Zdravkov
Reporter at Coindoo
Alexander Zdravkov is passionate about questions of meaning. He is a fluent German speaker as well as He has been in the crypto space for more than three years and has an eye for spotting emerging trends in the world of digital currencies. Whether providing in-depth analysis or reporting on all topics on a daily basis, his deep understanding and enthusiasm for what he does makes him a valuable addition to the team.
