Bitcoin Drops Towards $80K as US Dollar Strengthens
1min read Bitcoin's price has been volatile in recent days, with the cryptocurrency dipping towards the $80,000 mark as the US dollar strengthens from a 12-week low. The weakness in the crypto market can be attributed to several factors, including US trade tariffs and the lack of progress on a US strategic crypto reserve.
Data from Cointelegraph Markets Pro and TradingView shows that Bitcoin (BTC) reached new local lows of $82,037 on the BTC/USD pair on Bitstamp. The pair then rebounded to near $85,000, still down over $10,000 from the previous day's high. The sell-off was exacerbated by President Trump's renewed push for tariffs on Canada, Mexico, and China, which reinforced investor concerns over escalating trade tensions. Stocks also struggled in the face of tariff pressures, something likely on the radar for President Trump.
The sell-off was not stemmed by the SEC's latest move to pause and dismiss enforcement cases against crypto firms, underscoring broader risk aversion in the market. After a month of subdued cross-asset volatility, market anxiety has resurfaced with the prospect of tit-for-tat tariffs dampening global growth sentiment.
Despite the recent downturn, some trading firms remain optimistic about the short-term performance of risk assets. mosaic Asset, for instance, argued that bearish investor sentiment and oversold breadth are conditions that can help see a rally unfold. The firm also noted that seasonality and cycle trends for the S&P 500 can become a tailwind in the near term.
Existing expectations for Bitcoin also suggest a potential recovery in March, thanks to shifting macroeconomic conditions. Julien Bittel, head of macro research at Global Macro Investor, last week forecast a March recovery for Bitcoin. The US dollar index (DXY) hit 12-week lows on the day before seeing a modest relief bounce of its own.
