70% Chance Crypto Market Will Bottom Before June as Trade Fears Weigh on Investor Sentiment
The cryptocurrency market could hit its lowest point within the next two months, with a 70% chance of this happening before June, according to Aurelie Barthere, principal research analyst at Nansen. The timing depends heavily on the outcome of ongoing global tariff negotiations, particularly the reciprocal import tariffs announced by U.S. President Donald Trump. These tariffs, intended to reduce the country's trade deficit and boost manufacturing, are creating uncertainty across financial markets.
Trump unveiled these measures on April 2, aiming to address a $1.2 trillion trade gap. The global markets have already shown volatility in response to previous tariff announcements, and experts are watching closely for the impact of this decision. Barthere emphasized that the mood of the ongoing trade discussions will play a crucial role in determining when the crypto market finds its bottom. Nansen's research estimates a 70% chance that crypto prices will reach their lowest point between now and June.
Bitcoin and Ethereum are both currently trading 15% and 22% below their highs for the year, respectively. As both digital and traditional markets remain stagnant, investors are being cautious. Bitcoin has been consolidating between $82,000 and $85,000, showing limited movement after a period of recalibration during the first quarter. Traders are looking for a breakout above $84,500, which would signal more positive momentum. Support for Bitcoin is seen at the $82,000 mark, while some analysts are eyeing a potential rise to $86,500 and even $90,000 if sentiment shifts positively.
Despite the market's cautiousness, the Crypto Fear & Greed Index remains above the 'extreme fear' mark for the third consecutive session. This suggests that, while there is some improvement in sentiment, investors are still hesitant to take on large positions in an uncertain environment. As a result, many are choosing to adopt a 'wait and see' approach, holding off on significant investments until the outlook becomes clearer.
The volatility in both traditional markets and cryptocurrencies highlights how intertwined they have become in the face of global economic uncertainty. As the U.S. continues its tariff negotiations, investors are hoping for a resolution that will provide clarity for the markets. Barthere believes that once the hardest part of these talks is over, the crypto market could finally see a clearer path to recovery, signaling a potential bottom for cryptocurrencies like Bitcoin and Ethereum.
The key takeaway is that trade tensions are continuing to shape investor sentiment, and the outcome of these negotiations will likely be pivotal in determining the direction of the crypto market in the coming months.
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