Bitcoin Buyers Face a Tough Challenge Against Short-Term Downtrend
Market Overview
Bitcoin (BTC) is struggling to regain momentum after experiencing renewed selling pressure on Monday. The decline follows escalating trade tensions after former U.S. President Donald Trump announced a 25% tariff on all aluminum and steel imports, just days after implementing a 10% tariff on Chinese goods. In response, Beijing revoked planned retaliatory tariffs on key U.S. exports, including coal, liquefied natural gas (LNG), crude oil, and agricultural machinery.
Despite Bitcoin’s reputation as a hedge against traditional market volatility, it has failed to maintain stability amid geopolitical and economic uncertainty. Conversely, gold surged to record highs last week, and the U.S. dollar strengthened, as investors anticipated that tariffs could fuel inflation, forcing the Federal Reserve to keep interest rates elevated for longer.
Technical Analysis
Bitcoin Faces a Critical Resistance Zone Amid Bearish Momentum
BTC/USD remains in a short-term downtrend on the four-hour chart, with price action constrained below a descending trendline. After hitting a low of $94,626.10, selling pressure eased, allowing a temporary rebound above the 34-period moving average, signaling waning bearish momentum. Buyers pushed prices past $97,253.00, testing the downtrend resistance at $97,967.52, which aligns with the descending trendline. A successful breakout above this level could extend the recovery toward the 100-period moving average at $98,876.42. Further upside would expose key resistance levels at $99,879.90 and $101,503.32, indicating a potential trend reversal.
However, momentum indicators remain neutral, suggesting that the current move is a temporary retracement rather than a sustained reversal.
A failure to break above $97,967.52 could trigger renewed selling. If BTC drops below $94,626.10, the downtrend would continue, targeting deeper support levels.
Key Technical Levels
- Resistance: $97,967.52, $98,876.42, $99,879.90, $101,503.32
- Support: $97,253.00, $96,249.52, $94,626.10
Fundamental Drivers Affecting Bitcoin
U.S. trade policy uncertainty is increasing inflation risks, supporting the dollar and traditional safe-haven assets like gold. While Bitcoin is often seen as a hedge against fiat instability, recent price action suggests that it remains highly sensitive to macroeconomic trends. The upcoming testimony of Federal Reserve Chair Jerome Powell in Congress and U.S. inflation data this week could trigger additional volatility in BTC.
Conclusion
Bitcoin’s short-term outlook remains bearish, with resistance at $97,967.52 defining the next move. A breakout above $98,876.42 would signal a shift in sentiment, while a drop below $94,626.10 would confirm further downside. Upcoming U.S. economic data could be a key catalyst for BTC’s next major move.
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