Bitcoin under pressure: Trump tariffs strengthen the dollar

As the dollar reaches its biggest gain in three days, bitcoin struggles to recover in a market dominated by bears. Is it time to buy or sell?

The price of bitcoin closed at $84,708 on Thursday, up slightly by 0.54%, but remains under pressure due to the tariffs imposed by President Donald Trump, which strengthened the dollar. Meanwhile, the crypto market is showing signs of oversold, with significant capital outflows in ETFs and open interest in futures falling to $51.67 billion.

The price fluctuated between a high of $87,078 and a low of $82,716, breaking the key support of a bearish channel in place since January 20. / Tradingview

Dollar strengthens and bitcoin weakens due to tariffs

The dollar index (DXY) rose 0.77% on Thursday, reaching 107.35 points, its biggest daily gain since January 2. This rally is due to Trump's comments about implementing 25% tariffs on Mexican and Canadian products, which generated uncertainty in global markets. A stronger dollar traditionally weakens bitcoin and other cryptocurrencies, considered risk assets.

Bitcoin in oversold zone

Despite closing with a slight rise of 0.54%, bitcoin continues to show weakness. The price fluctuated between a maximum of $87,078 and a minimum of $82,716, breaking the key support of a bearish channel in force since January 20. Trading volume exceeded the 25-day average, and the formation of a doji candle increased uncertainty in the market.

The Short-Term Holder MVRV indicator fell to 0.94 points, meaning that short-term "hodlers" are trading below their average cost of $92,300.

Massive capital outflows

The Bitcoin ETF market recorded a net outflow of $2,208.90 billion in three days, the largest since its launch. Additionally, net capital flow in the spot market was negative for the sixth consecutive day, with outflows of $539.32 million in the last 24 hours.

In Bitcoin futures, open interest fell to $51.67 billion, with liquidations of $224 million, of which 94.58% corresponded to long positions. This reinforces the dominance of bears in the market.

Altcoins Resist the Fall

As Bitcoin struggles to stabilize, some alternative cryptocurrencies such as BERA, LEO, and LTC recorded slight gains, demonstrating some resilience in a volatile market. However, Bitcoin's dominance remains at 59.9%, compared to 30.2% for the rest of the cryptocurrencies and 9.9% for Ethereum.

The crypto market is facing a time of uncertainty, with a strong dollar and massive capital outflows. Although Bitcoin is showing signs of being oversold, investors should remain cautious in the face of volatility and lack of clarity in the macroeconomic outlook.

Disclaimer: This analysis is for informational purposes only and does not constitute financial advice. Cryptocurrency investments are volatile and involve risk. Please do your research and consult a professional before making financial decisions.