Bitcoin’s graph is flashing red warning signs
Last Updated on 9 February 2025 by CryptoTips.eu
The latest economic figures from the United States caused the stock markets to close in the red on Friday, just as Bitcoin continues to drop towards the lower half of its trading band. A retest of the support line at $90,000 suddenly seems like a possibility again, which would mean Bitcoin is at a loss compared to the start of the year. Is it time to buy the dip or should you wait it out?
Inflation and trade war
Economists fear rising inflation now that a trade war between the various major democratic blocs seems inevitable. Although Donald Trump had promised, according to several late night presenters, that he would immediately reduce the prices of grocery products, some Americans have already started hoarding because they fear that everyday items might get even pricier.
Daily $BTC Chart Analysis:#Bitcoin is now testing a really important support at around $96,000
— AlternativeBull (@Alternativbull) February 8, 2025
If daily candle closes below the support it can lead to a dump to around $90,000 or below, if it bounces from here and closes as a green candle it would be very healthy and would… pic.twitter.com/MDvxxEW1vd
Normally Bitcoin is a safe investment in times of inflation, but at the moment it seems that we are mainly on the way down. The support line, which is around $90,000, is gearing up for a retest. According to analysts at Barron’s, a fall to $80,000 would also be a possibility. This means that we can drop another 20% lower.
Strategic Bitcoin Reserve
At the same time, crypto investors’ hopes for a Strategic Bitcoin Reserve (SBR) by the Trump administration appear to be dwindling.
In his latest essay, Bitmex founder and crypto savant Arthur Hayes (who’s been the best short-term Bitcoin forecaster of recent years), also says he sees no reason to believe that this would be a good idea.
Arthur argues that an announcement of an SBR could indeed boost the Bitcoin price, but since politicians can then decide the price of the largest cryptocurrency with a simple announcement, he thinks they would abuse this power for their own good.
