Tariff Pause: A Boost for Bitcoin?

In a surprising twist, U.S. President Donald Trump announced a 90-day hiatus on tariffs, igniting a remarkable 8.27% surge in Bitcoin prices on April 9. This marked the cryptocurrency's most substantial green day in nearly a month! Just a day later, positive news continued to pour in as U.S. core CPI inflation dipped below 3.0% for the first time since March 2021, propelling Bitcoin to an impressive $82,532.

A Critical Moment for Short-Term Holders

However, as optimism builds, significant challenges loom. Bitcoin’s Short-Term Holders (STHs) are currently under pressure, especially with their average purchase price lingering around $93k—far above the current value.

Capitulation Risks on the Horizon

Recent data indicates that the supply of Bitcoin held by short-term investors is at a crucial tipping point. After peaking at a four-year high of 400k BTC on February 10, this number has dropped to 360k, hinting at increasing sell-off activity.

Notably, those who acquired their Bitcoin when it was valued at around $93k now face significant unrealized losses. If Bitcoin were to plunge to the lower support level of $72k, a potential capitulation could ensue, causing a wave of liquidations.

Market Dynamics and Future Outlook

From a broader perspective, Bitcoin's price is struggling below the pivotal $85k resistance level. Consistent failures to break through this barrier may signal further turbulence ahead. As the Estimated Leverage Ratio (ELR) has dipped below its March levels, it suggests that futures traders are becoming increasingly conservative, pulling back on high-leverage bets.

Yet, amidst the storm of macroeconomic uncertainty, Bitcoin has shown a remarkable resilience, sustaining a relatively minor $90 billion market cap drawdown—significantly less severe than other high-risk assets.

What Lies Ahead?

As the Federal Reserve appears unlikely to initiate interest rate cuts in the near future, anxious short-term holders may begin to cash out to mitigate losses. With many having invested around $93k, the pressure mounts to recover before more drastic selling occurs—making the next few weeks critical for Bitcoin’s trajectory.