Crypto Prices Rally on US Tariffs Pause; Bullish Conditions Yet to Improve: CryptoQuant
An April 10 CryptoQuant Report showed that crypto markets experienced renewed volatility this week as the announcement of a 90-day tariff pause by President Trump temporarily alleviated escalating trade tensions, while overall bullish sentiment remains subdued.
Early in the week, the uncertainty driven by retaliatory tariffs imposed by China and the EU pushed Bitcoin into a sharp sell-off, dropping its price from approximately $84K to a five-month low near $74K.
Digital Assets Sensitive to International Policy Shifts
This decline was a direct response to the escalating trade war, underlining the sensitivity of the digital asset market to international policy shifts. Following the initial plunge, prices rebounded shortly after on April 9. President Trump’s tariff pause announcement, which applies a universal 10% tariff on all countries except China—where tariffs were increased to 125%—played an important role in restoring investor confidence and recovering much of the lost value.
Technical analysis shows that Bitcoin’s price bounce was supported by its 365-day moving average (MA), which currently stands at around $76.1K. Past observations in August 2024, July 2021, and December 2021 further confirm that a sustained drop below the 365-day MA could signal the commencement of a prolonged bear market.
Market Sentiment Remains Notably Pessimistic, Says CryptoQuant
While Bitcoin found temporary stability above this average, caution persists among traders regarding its long-term implications. Despite the technical rebound, market sentiment remains notably pessimistic. According to CryptoQuant’s Bull Score Index, Bitcoin currently registers a reading of 10, its lowest since November 2022. This depressed score reflects an overall cautious investor outlook and indicates a low probability of an enduring rally, suggesting that the recent recovery might be more of a short-term correction than the onset of a bullish trend.
CryptoQuant reports should this score continue to linger below the 40 mark, market conditions could resemble those seen in previous bearish cycles. Looking ahead, if Bitcoin’s upward trajectory sustains, it may encounter resistance at near-term price levels of around $84K and subsequently at the $96K zone. These resistance levels have historically served as markers within this trading cycle, potentially acting as barriers should the present rally fail to translate into a sustained shift in market sentiment. Overall, while the tariff pause has provided a temporary breather, the market remains cautious, eagerly awaiting more robust bullish signals.