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Trade Wars and Bitcoin: The Chaotic Dance of Economics!

BBG News
  • BTC did a little jig and bounced up +10% after Trump paused his tariff tantrum.
  • Analysts are having a collective fit: will a China tariff deal moon BTC or bury it?

On the 9th of April, Bitcoin, that quirky digital currency, leapt up a staggering 10% to $83.5K after President Trump decided to give his tariff war a little holiday, though not for China, because, let’s face it, why would he?

There was joy in the land of stocks and shares, or as joyful as one can get during a tariff tantrum. But all eyes, of course, were on the U.S.-China trade debacle—because it’s not a real drama until someone’s wallet is involved. Trump had been raising tariffs on Chinese imports to a staggering 125%, while China clapped back with its own 84% increase. Technically, this is known as “making friends” in diplomatic circles.

According to various analysts, this tariff showdown might just be the melodramatic plot twist BTC so desperately needs. But, naturally, there was disagreement among the wise sages of finance.

Navigating BTC’s Tariff Shenanigans

Now, it seems China was all set for a deal—at least that’s what President Trump implied. Jumping on the economic rollercoaster, analyst Joe McCann stated that a potential agreement could rocket BTC to the moon, as long as no one forgot their helmets. Notably, he mused that this possibility hadn’t yet been priced in—an intriguing perspective that absolutely didn’t involve a crystal ball.

“If a China deal comes, the market’s gonna explode. If it doesn’t, well, we’ve already bought our tickets. Trump’s ready to crank up the volume of max pain for China and is willing to negotiate. The market can only re-price higher—or, you know, stay on the ground with the rest of us.”

McCann further suggested that a rallying Yuan (CNY) against the US dollar (USD) might hint at happy times ahead. Unfortunately, China seemed to prefer a weaker Yuan, creating what Jeff Park from Bitwise described as a potential “oopsie” moment for risk assets, including our dear BTC.

“What’s happened with a weaker yuan now exporting deflation, paired with a 10% tariff dragging growth? The outcome isn’t quite a picnic in the park for risk assets—especially with that stubborn 10-year yield staying above 4%.”

Arthur Hayes, Big Cheese over at BitMEX, chimed in with a similar sentiment but with a twist of optimism, predicting money printing by the Fed could end up like confetti, boosting BTC in the process.

“If there’s no deal, the PBOC might just continue to let the Yuan weaken gradually. Buckle up, folks. Luckily, BTC has a penchant for money printing and the inevitable CNY frazzles.”

Nevertheless, the fallout from tariffs has made BTC look quite attractive, particularly for international trade between Russia and China—something noted by VanEck, that oracle of modern finance.

BTC Breakout Prospects

As we steered full steam ahead into April, heavy hedging felt like everyone’s favorite pastime, indicated by the not-so-cheerful negative readings on the 25RR (25 delta risk reversal). This indicated a sudden spike in demand for put options—essentially, bets that everything might go terribly wrong.

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Furthermore, the bullish RSI divergence backed up these breakout prospects. So, if macro conditions decide to play nice, last year’s range of $70K could hold the key to the Castle of Profit for many.

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2025-04-10 20:12

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