Bitcoin’s abrupt price move came in response to headline-making comments from U.S. President Donald Trump, who criticized stalled trade negotiations with the European Union. He said:
“Our discussions with them are going nowhere! Therefore, I am recommending a straight 50% tariff on the European Union, starting June 1st, 2025.”
The fallout extended to traditional equities, with the S&P 500 and Nasdaq Composite both slipping 1% and 1.2%, respectively, shortly after the U.S. stock market opened.
Donald Trump Announcing New Tariffs On The EU
Source: X (@realDonaldTrump)
‘Skew’, a popular crypto trader, summarized the sentiment succinctly on X:
“Nice aggregate flush of long leverage & de-risk selling from spot. All driven by headlines once again.”
According to CoinGlass, nearly $350 million in long positions were wiped out within four hours, while the 24-hour liquidation total surged past $500 million.
‘Daan Crypto Trades’, another popular crypto trader, echoed Skew’s concerns, noting that the market’s behavior suggested a significant macro-driven shift:
“There’s the break from the compression with a push from Trump. Markets worldwide obviously not liking the news.”
He added that Bitcoin’s performance relative to equities would be closely watched as uncertainty surrounding global trade policy resurfaces.
Commenting on the broader economic picture, The Kobeissi Letter, a respected macroeconomic insights outlet, offered a nuanced take on the evolving situation:
“Too much tariff pressure causes the basis trade to unwind. Too little tariff pressure causes inflation expectations to rise.”
They emphasized that Trump’s administration, if elected again, would need to strike a delicate balance:
“Now, President Trump must find a middle ground to maintain tariffs but also suppress treasury yields WITHOUT Fed cuts.”
This analysis reflects the broader conundrum facing policy makers, namely maintaining trade leverage without stoking inflation or triggering bond market instability.
‘Crypto Caesar’, a respected crypto market analyst, highlighted a crucial price zone just below $110,000, urging caution as BTC attempts to regain its footing.
BTC/USD 1-Hour Chart
Source: TradingView
Caesar went on to explain:
“We need to hold the green zone. This is absolutely vital, as breaching this level could lead to further downside and bearish sentiment sooner than anyone expects.”
Meanwhile, fellow trader ‘Poseidon’ pointed out a relatively clear path to the upside if bulls can regain momentum. This was supported by Skew’s order book analysis, which suggested limited resistance above the current spot price.
In Skew’s own words:
“Front ran $110K tag. Important level from here for the market to auction above, this is key for continuation.”
Furthermore, the absence of heavy sell orders above this range opens the door for a potential bounce, provided macro conditions stabilize and sentiment shifts positively.
In any case, Trump’s latest tariffs are indicative of the fact that Bitcoin remains highly sensitive to global macroeconomic developments, particularly geopolitical risks and trade policy shifts.
This is of the utmost significance particularly because, despite being touted as a hedge against traditional markets, BTC continues to behave like a risk asset in periods of uncertainty.
The sheer scale of liquidations and rapid market responses reinforce the need for caution, especially for traders using leverage.
As the dust settles, the crypto community will be watching both Washington D.C. and Brussels closely, with June 1st now marked as a potentially pivotal date for markets, crypto and traditional alike.
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