Trump Tariff Announcement Applies Emergency Brakes On Bitcoin Rally: Retail Turns Bearish

Bitcoin's (BTC) recent rally stumbled after news broke that President Donald Trump's tariffs on China, Canada, and Mexico would take effect on Saturday. 

The cryptocurrency, which had surged to over $106,000 earlier in the day, declined nearly 3% on Friday following the announcement. 

At the time of the drop, Bitcoin was trading at just under $103,000, halting its upward momentum.

The overall cryptocurrency market mirrored Bitcoin's downturn, with a 3.5% dip across major assets. Ethereum (ETH) was the only crypto major in the green, holding onto gains of 1.6%.

As U.S. inflation persists at high levels, with tariffs adding pressure, the Federal Reserve will be less inclined to reduce interest rates. 

That will weigh on risk assets, like cryptocurrencies, as in December after the Trump trade rally.

On Stocktwits, retail sentiment around the apex cryptocurrency turned ‘bearish’ from ‘bullish’ a day ago while chatter remained at ‘normal’ levels. 

One user pointed out that Bitcoin's price volatility has intensified with increasing government involvement.

Others are anticipating further declines, with some speculating Bitcoin could fall below $100,000 again, marking its second drop below that threshold this week.

Bitcoin's price has more than doubled over the past year and is currently trading 5.6% below its all-time high of $108,786, which was reached ahead of Trump’s inauguration.

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