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The bullish euphoria of Donald Trump’s Crypto Strategic Reserve was short-lived.
The Bitcoin price fell 12% from its post-announcement high of $95,000 and traded as low as $82,450 on Tuesday.
The total crypto market capitalization shrunk by $460 billion in a span of a few hours, the sell-offs triggered by Donald Trump’s tariffs going live. US equity indexes, including NASDAQ 100, S&P 500 and Dow Jones, also closed Monday in deep-red territory.
The only question now is whether the crypto bull market is over or if it is still prudent to buy the dip and when.
Why Is Crypto Crashing Today?
Donald Trump’s investment announcement turned out to be a major setback for US equities and the crypto market.
The president initially announced that chipmaker Taiwan Semiconductor Manufacturing Company ($TSMC) will invest $100 billion in the United States through its new chip plants.
However, his press conference proved to be a disaster, considering it confirmed that the tariffs against Mexico and Canada wouldn’t be delayed and have now gone live from Tuesday. He also doubled tariffs on Chinese imports from 10% to 20%.
TARIFFS NOW LIVE:
1. 25% tariffs on all good from Mexico to US
2. 25% tariffs on all goods except energy from Canada to US
3. 20% tariffs on many goods from China to US
4. 10% tariffs on energy from Canada to US
5. 25% retaliatory tariffs on up to $155B of goods from US to…
China has already imposed retaliatory tariffs on US agricultural and food products while also restricting exports and investments on 25 US firms.
The trade war is expected to exacerbate the stickly inflation levels in the US economy, a bearish scenario for equities and crypto prices. It will also delay the Federal Reserve’s QE, which the bulls had been desperately hoping for.
Bitcoin Price Prediction — When To Buy The Dip?
The Bitcoin price has now fully retraced its Crypto Strategic Reserve pump and is trading above $83,000 at press time.
However, BTC doesn’t have much support at these levels and will very likely dip to sub-$80k.
Instead, smart money investors are now eyeing the 50-week EMA, a level Bitcoin has successfully defended since June 2023.
If the bull market isn’t over, BTC could create a significant bottom at this moving average and kickstart its bullish reversal.
Bitcoin price predictions from prominent analysts suggest that the cycle top isn’t in just yet. Global liquidity is on the up once again, and financial conditions are expected to ease significantly from March, GMI’s Head of Macro Research Julian Bittel reveals.
There’s a lot of noise in the market right now – conflicting narratives everywhere.
But here’s the reality – or at least my take on what’s really going on:
Everything happening in markets right now, especially in crypto, is a direct consequence of the tightening of financial… pic.twitter.com/iLPqiyw3LX
All eyes are on the March 7th White House Crypto Summit. Trump’s crypto czar David Sacks reveals that details regarding the Strategic Crypto Reserve would be unveiled at the event, which could spark a recovery in the market.
Simply put, sidelined investors should wait for a retest of the 50-week EMA or the $72k – $74k region before buying the dip.
Crypto Presales In High Demand Amid Market Uncertainty
Donald Trump’s trade war has increased market uncertainty, causing investors to pivot to low-cap assets and presale cryptocurrencies.
Considering the bull market isn’t over just yet, investing in high-potential presale coins could pay dividends down the line when the broader outlook improves.
For instance, a whale invested nearly $200k in Solaxy (SOLX), the first prominent Solana layer-2 coin, which has already raised nearly $25 million in its presale phase.
The Layer-2 chain features ZK-proofs, data availability tools, a deterministic sequencer and a multi-chain bridge and is designed to tackle the network congestion issues on Solana during periods of heavy traffic.
Solaxy promises high scalability, excellent network throughput and fast and cheap transactions on both chains.
Prominent analysts believe SOLX is highly undervalued during its presale stage and could deliver outsized returns when Solana pushes towards new highs. Several early buyers are eyeing anywhere between 10x and 100x returns.
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