It was a painful Friday for some crypto traders. The announcement of the 100% import tariffs on goods from China triggered a massive market sell-off. This one was the third of its kind in the history of BTC and the crypto market. First one occurred in March 2020, the second one in mid-2023 and just now. But this one was a bit different because the crypto market has grown significantly. Within only a few hours BTC dropped to the level of $105K, altcoins entered into scary freefall, most dropping between 70-90% in value, nearly $1 trillion was erased in the crypto market cap. This one was indeed a massive sell off. The issue is that no one on the market was expecting it, which is what long positions are showing. Over $22B in positions was liquidated. Analysts are noting that this was not a retail dump, because only institutional investors have the financial strength to move markets in such a massive way.
It was a regular week on the crypto market, until Friday. BTC was previously trading above the $122K level, while the massive Fridays selloff pushed the coin down to $105K, but soon, BTC reverted back. Saturday’s trading is around $112K. The RSI was pushed down to the level of 40, however, a clear oversold market side has not been reached. The MA50 is still not clearly converging toward the MA200, so the potential cross is still not in the plan.
Professionals perceive Friday’s move as a positive, no matter how hurtful it may look. The reason for this is that leverage is now whipped out, shorts are over-extended while smart investors are quietly buying from panic sellers. So, in their perception, this is not the end, this move is just the beginning of the next leg of BTC and the crypto market. So, the question is where from now? Trisky question for the week ahead. Certainly, brave inventors and holders of BTC will use this drop in value to add more to their holdings. This might push the price a bit higher. However, it should be considered that further news on trade tariffs are expected in the week ahead, which might bring back some negative sentiment. What is certain is that the crypto and BTC market will use the week ahead to find the new equilibrium level between risks from tariffs and the value of BTC.
