Bitcoin (BTC) has staged a modest comeback, trading above $84,000 on Tuesday after stabilizing around $82,500 on Monday following a 4.29% drop last week. Despite economic headwinds, the cryptocurrency is showing signs of resilience, buoyed by shifting market dynamics and institutional moves.
However, traders remain on edge as macroeconomic pressures, including Trump’s tariffs and stagflation risks, loom large. Here’s what’s driving Bitcoin’s latest moves and what to watch next.
Bitcoin Dominance Surges to 61.4% as Tether Bolsters Reserves with $735M
Bitcoin’s grip on the crypto market tightened, with its dominance climbing to 61.4%, according to Crypto Finance’s Tuesday report. This uptick reflects a flight to Bitcoin Price prediction as a sturdy asset amid market turbulence, a trend reinforced by Tether’s withdrawal of 8,888 BTC—worth $735 million—from Bitfinex’s hot wallet.
Tether’s reserve now holds 92,647 BTC, valued at $7.65 billion, making it the sixth-largest Bitcoin wallet. This shift, reducing exchange selling pressure, signals robust institutional faith in Bitcoin’s staying power. The report suggests BTC’s relative strength could persist as long as macro uncertainty and volatility linger, though a return of risk appetite might lift altcoins later.
Economic Clouds Gather: Trump Tariffs and Stagflation Threaten Downward Pressure
Bitcoin’s recovery faces stiff challenges from a jittery economic landscape. The Kobeissi Letter notes the US Trade Policy Uncertainty Index at 25%, surpassing levels from Trump’s first trade war, a historic high.
Analyst Ray Wang’s data shows Trump’s threatened tariffs on the EU could hit $600 billion in imports, shaving 70 basis points off US GDP while adding 40 basis points to inflation. With stagflation fears mounting—echoed by Goldman Sachs’ 35% recession odds—risk-off sentiment could drag Bitcoin lower, given its ties to equity markets.
Yet, over the medium to long term, BTC might shine as a hedge against inflation and a weakening US Dollar if the Fed softens its stance.
Price Outlook Mirrors BTC Targeting $85,000 Amid Fragile Momentum
After slipping below its $85,000 consolidation floor last week and shedding 5.53% through Sunday, Bitcoin has clawed back to trade above $84,000. The daily Relative Strength Index (RSI) sits at 45, trending toward a neutral 50, hinting at fading bearish steam—but it must break above 50 to confirm a rally.
The MACD shows trader indecision with coiled lines. A push past $85,000 resistance could propel BTC to $90,000, a key psychological marker.
Conversely, rejection at $85,000 might send it tumbling to $78,258 support. With Trump’s tariff “Liberation Day” looming Wednesday, volatility is likely—offering dips for long-term buyers if stagflation takes root.
