Approximately 10 weeks ago, CoinDesk highlighted a double top bearish reversal pattern in Bitcoin (BTC), cautioning about a possible drop to $75,000, a scenario typical for a pullback in a bull market.
This Monday, the price dipped below that mark as rising trade tensions caused a significant downturn in financial markets, resulting in a staggering decrease of roughly 900 points in Dow Jones Industrial Average futures. According to technical analysis, the selling pressure for BTC might stabilize within the $70K to $75K range, as indicated earlier in January.
Additionally, the Australian dollar (AUD), which is sensitive to commodity markets and particularly susceptible to the impact of Trump-induced trade tensions, is bringing optimism to cryptocurrency investors. The AUD/USD exchange rate bounced back to 0.6011 after plummeting to 0.5930 earlier in the day, based on information from TradingView. This pair faced significant losses on Friday, dropping over 4%, which is notable for a national currency.
When trade disputes intensify, the currencies of the involved nations typically react swiftly in anticipation of shifts in trade balances, economic conditions, and interest-rate expectations. The AUD is a prime example, functioning as a proxy for China, a major importer from Australia. Therefore, the AUD’s rapid recovery could indicate that the sell-off driven by tariffs is nearing its peak.
That said, trying to buy in a declining market is akin to attempting to catch a falling knife—an inherently risky approach.
