Bitcoin bottoms at $91.5K on global trade war fears, highlighting economic concerns
2025-02-03
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Bitcoin’s price found its local bottom just above the $91,000 mark, highlighting its increasing sensitivity to macroeconomic developments.
Bitcoin's BTCUSD price fell to an over three-week low on Jan. 3 of $91,530 at 02:00 am UTC, which marked the local bottom, before recovering to $95,306 as of 8:14 am in UTC, Cointelegraph Markets Pro data shows.
Bitcoin’s correction came two days after President Donald Trump signed an executive order to impose import tariffs on goods from China, Canada and Mexico, according to a Feb. 1 statement from the White House.
The downturn was driven by escalating investor concerns over a potential global trade war following Trump’s tariffs, according to Ryan Lee, chief analyst at Bitget Research.
The analyst told Cointelegraph:
Canada, Mexico and China have promised “retaliatory measures” for Trump’s tariffs, which “further heightened investor anxiety, prompting a shift away from riskier assets, including cryptocurrencies,” the analyst said.
Bitcoin’s movement remains in line with previous analysts’ predictions of a “local top” above $110,000 in January, before a deeper retracement.
Based on its correlation with the global liquidity index, Bitcoin’s right-hand side (RHS), which marks the lowest bid price someone is willing to sell the currency for, before an “interim peak in liquidity,” may lead to a correction below $70,000 in February, Raoul Pal, founder and CEO of Global Macro Investor, said in a Nov. 29 X post.
Bitcoin remains sensitive to macroeconomic developments
Despite Bitcoin’s narrative as a hedge against volatility in traditional finance markets, it remains sensitive to economic developments.
Still, Bitcoin may still see a rebound compared with traditional markets, according to Alvin Kan, chief operating officer at Bitget Wallet.
Kan told Cointelegraph:
Despite short-term correction concerns related to the $36 trillion US debt ceiling, industry watchers remain optimistic about Bitcoin’s prospects for the rest of the year.
Analyst predictions for the rest of the 2025 market cycle range from $160,000 to above $180,000.
How Much Higher Will Bitcoin Go? | Mark Yusko’s 2025 Predictions. Source: YouTube