Bitcoin Plunges to $78,000 as Trump Tariffs Trigger Global Market Turmoil
Bitcoin is holding precariously above the $78,000 mark after experiencing a sharp 6% decline over the past 24 hours, as global markets reel from President Trump’s sweeping new tariff policies. Despite the significant drop, analysts note Bitcoin’s comparative stability against traditional equities, which have suffered even steeper losses.
Trump’s “Economic Medicine” Rattles Global Markets
Beginning April 5, the Trump administration imposed broad tariffs on all nations with a baseline 10% levy and drastically higher rates on China (34%), the European Union (20%), and Japan (24%), important trading partners. The aggressive trade agenda shook financial markets all around.
When asked about the market sell-off, Trump stayed firm, telling Air Force One reporters that he wasn’t specifically instigating market upheaval but that “sometimes you have to take medicine to fix something.” Declaring taxes “a beautiful thing to behold” already bringing “tens of billions of dollars into the USA,” he doubled down on his stance via Truth Social.
The effects on conventional markets have been somewhat dramatic. Whereas the Dow Jones Industrial Average futures plunged by almost 8%, futures linked to the S&P 500 fell by 4%. Additionally showing notable declines was the tech-heavy Nasdaq. Based the trading resource Kobeissi Letter, during the past 32 days the US stock market has erased an average of $400 billion every trading day.
Crypto Market Sentiment Plunges to “Extreme Fear”
The market for cryptocurrencies has not spared damage either. Bitcoin BTC/USD fell over 6% before recovering somewhat to over $78,500; Ethereum ETH/USD fell even more, at over 12%, trading at about $1,594. More than 8% to $2.5 trillion in overall market value for cryptocurrencies contracted.
Measuring market mood with the Crypto Fear & Greed Index, the current April 7 update shows a score of 23, suggesting “extreme fear” among investors.
Head of finance at Australian cryptocurrency exchange BTC Markets, Charlie Sherry said that “a few large sell-offs can have a disproportionate impact, pushing prices down quickly.” Sunday’s usually tight liquidity circumstances helped to explain part of the degree of the decrease. He stressed, though, that “there’s no mystery behind the trigger: President Trump’s recent tariff talk has rattled macro markets, with global trade relations suddenly looking uncertain.”
BTC/USD Technical Analysis: Diverging from Traditional Markets?
Some observers see indications of possible decoupling between Bitcoin and conventional markets even with the present dip. Popular trader Daan Crypto Trades pointed out an odd discrepancy in volatility measures, claiming that Bitcoin volatility is “going lower and lower while the VIX (Volatility Index) on Stocks has closed at the highest level since the Covid Crash in 2020.”
This difference has caused some traders to forecast that, should equities find a bottom early in the week, Bitcoin may undergo a notable price movement, therefore deviating from stock market performance.
Comparatively to post-ETF approval price movements and the August 2024 crash, Trader Cas Abbe proposed that recent lows around $76,000 could be a “classic fake breakdown.” Abbe said he’s waiting for a weekly recovery of $92,000 to verify ongoing upswing continuity.
Bitcoin’s Future Outlook Amid Economic Warning Signs
The degree of the market reaction has caused major worries among financial professionals. Encouraging President Trump to call a “time out” on Monday, hedge fund billionaire Bill Ackman cautioned of possible “economic nuclear winter” should the tariff policies go on unaltered. Should the economic dispute intensify, Ackman advised, “business investment will grind to a halt, consumers will close their wallets and pocket books”.
While tariffs are now upsetting markets, some traders—including BitMEX co-founder Arthur Hayes—have hypothesized that, especially if investors look for other stores of wealth among economic uncertainty, they might ultimately cause a Bitcoin surge.
All eyes will be on whether Bitcoin will keep its relative stability or if it will give in to more selling pressure as markets open for the new trading week through this moment of increased volatility and economic uncertainty.
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