The Article Tells The Story of:
- A bear flag hints that crypto may fall back to pre-election levels — or worse.
- Trump’s tariff shock is reviving recession fears and killing Fed rate cut hopes.
- Risk appetite is shrinking fast, and macro data shows more pain ahead.
- Could Bitcoin crash harder before June? One wrong signal may trigger a chain reaction.
Crypto Market Outlook April 2025: Will Bears Erase All Post-Election Gains?
The crypto market has entered April 2025 with clear signs of weakness. Technical patterns, policy changes in the U.S., and fears of a global slowdown have combined to pull prices down. Traders and investors are watching closely to see if the market will lose the gains made after Donald Trump won the U.S. presidential election in November 2024.
Bear Flag Pattern Suggests Market Correction Ahead
The total crypto market cap shows a bear flag pattern. This chart pattern forms when prices rise slightly after a sharp fall. The upward move happens inside a narrow channel. If prices break below this channel, it usually signals another drop.
Technical analysts often use the height of the first fall, called the flagpole, to predict how far prices may fall. In this case, if the market breaks down, it could fall back to $2.31 trillion. This level matches where the market stood before Trump’s election win.
If prices go even lower, they may test the 200-day exponential moving average (EMA), which sits around $2.28 trillion. That would be a strong signal that the bull trend has ended. However, this deeper drop might not happen immediately, because more factors are still in play.
Trump’s Tariff Shock Hits Risk Sentiment
The market took another hit after President Trump announced new tariffs on major U.S. trade partners. These tariffs echo the Smoot-Hawley Tariff Act of the 1930s, which contributed to the Great Depression.
Investors reacted quickly. On April 2, U.S. stock market futures dropped sharply. The S&P 500 fell 3.5%, and the Nasdaq 100 dropped 4.5%. At the same time, gold and the Japanese yen rose as traders looked for safer assets.
Bitcoin and other crypto assets showed a short bounce on April 3. But the rally was weak and could fade as global economic conditions worsen. Tariffs may increase inflation and slow growth, hurting risky assets like crypto.
Read More About Our Article of Donald Trump Establishes Strategic Bitcoin Reserve — What It Means for the U.S. Published on March 7, 2025 SquaredTech
Goldman Sachs now sees a 35% chance of a U.S. recession within 12 months. The bank warned that Trump’s tariffs could drive up import costs and delay any rate cuts from the Federal Reserve. Economist Jeffrey Frankel also said trade tensions could cause long-term damage to the global economy.
Lower Chance of Rate Cuts Adds Pressure
The Federal Reserve was expected to cut interest rates in June. But those chances are now shrinking. After Trump’s tariff move, the probability of a 25 basis point rate cut dropped from 62.3% to 57.1%, based on CME Group data.
Investors are now pricing in the risk that tariffs may raise inflation. If that happens, the Fed may hold interest rates steady for longer. Higher rates make it harder for crypto markets to rise, because investors tend to avoid riskier assets when borrowing costs stay high.
Crypto markets often rise when interest rates fall. Loose monetary policy increases liquidity and helps speculative assets grow. But now, with no clear sign of rate cuts, crypto may stay weak in the near term.
Economist Mohamed El-Erian expects only one rate cut this year. Many had hoped for two. This shift in outlook could limit crypto upside through June.
Market Sentiment Remains Fragile
The mood in the crypto market is cautious. Many traders are holding back. Volumes are falling. Retail investors are waiting for clearer signals from the Federal Reserve and global markets.
Until the Fed confirms rate cuts or inflation shows signs of slowing, crypto may struggle. The bear flag pattern on the chart shows how fragile the situation is. If prices break below support levels, more selling could follow.
Summary
April 2025 has started with stress for the crypto market. Bearish technical signals, new trade tariffs, and doubts about rate cuts are keeping investors on edge. The market may fall back to levels seen before Trump’s election win. Unless the Fed signals easing or inflation cools, crypto prices may stay under pressure through June.
Traders should watch the $2.31 trillion and $2.28 trillion levels closely. A break below these could mean the Trump rally is officially over.
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