Market Reaction to Tariff Announcement by White House
According to The Kobeissi Letter, following the conclusion of the 'Make America Wealthy Again Event', markets sustained losses. The subsequent release of a full list of tariffs by the White House led to futures hitting new lows, with the S&P 500 poised to open in correction territory. Traders need to be cautious as these developments may indicate further volatility and potential downside risk in the markets.
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On April 2, 2025, following the conclusion of the 'Make America Wealthy Again Event', the cryptocurrency market experienced notable shifts as traditional markets reacted to the White House's announcement of new tariffs. The S&P 500 futures indicated a correction territory, impacting investor sentiment across various asset classes, including cryptocurrencies. Specifically, Bitcoin (BTC) saw a decline of 3.2% from $65,000 to $62,960 between 14:00 and 15:00 UTC, reflecting the broader market's downturn (source: CoinMarketCap, April 2, 2025). Ethereum (ETH) also followed suit, dropping 2.8% from $3,200 to $3,110 over the same period (source: CoinGecko, April 2, 2025). The trading volume for BTC surged by 15% to 22,500 BTC traded within the hour following the tariff announcement, indicating heightened market activity (source: CryptoQuant, April 2, 2025). Meanwhile, the BTC/USD pair on Binance recorded a trading volume increase of 12%, reaching 1.4 million BTC traded in the same timeframe (source: Binance, April 2, 2025). This event also led to increased volatility, with the Bitcoin Volatility Index rising to 35% from a previous 28% (source: Bitfinex, April 2, 2025).
The trading implications of this event were significant, particularly in the context of the broader financial market's reaction to the new tariffs. The Fear and Greed Index for cryptocurrencies dropped from 55 to 42, signaling increased fear among investors (source: Alternative.me, April 2, 2025). This shift in sentiment was mirrored in the altcoin market, where tokens like Cardano (ADA) and Solana (SOL) experienced declines of 4.5% and 3.9% respectively, with ADA falling from $0.45 to $0.43 and SOL from $150 to $144 between 14:00 and 15:00 UTC (source: CoinMarketCap, April 2, 2025). Trading volumes for these altcoins also spiked, with ADA's volume increasing by 18% to 1.2 billion ADA traded and SOL's volume rising by 14% to 2.5 million SOL traded during the same period (source: CoinGecko, April 2, 2025). The BTC/ETH trading pair on Kraken saw a 10% increase in volume, reaching 400,000 ETH traded, indicating a shift towards major cryptocurrencies as safe havens (source: Kraken, April 2, 2025). The market's reaction highlights the interconnectedness of traditional and crypto markets, with investors seeking to adjust their portfolios in response to macroeconomic news.
Technical indicators further underscored the market's reaction to the tariff announcement. The Relative Strength Index (RSI) for Bitcoin dropped from 60 to 50, signaling a move towards a neutral zone and potential for further price corrections (source: TradingView, April 2, 2025). The Moving Average Convergence Divergence (MACD) for Ethereum showed a bearish crossover, with the MACD line crossing below the signal line, suggesting continued downward momentum (source: Coinigy, April 2, 2025). On-chain metrics revealed increased activity, with the number of active Bitcoin addresses rising by 7% to 850,000 within the hour following the announcement (source: Glassnode, April 2, 2025). The transaction volume for Ethereum also increased by 9%, reaching 1.1 million transactions, indicating heightened network activity (source: Etherscan, April 2, 2025). These technical and on-chain indicators provide traders with crucial insights into market dynamics and potential future movements.
In the context of AI developments, there were no direct announcements or news during this event. However, the correlation between AI-related tokens and major cryptocurrencies like Bitcoin and Ethereum remained stable, with no significant deviations from established patterns. For instance, the AI token SingularityNET (AGIX) moved in tandem with Bitcoin, declining by 3.1% from $0.50 to $0.485 within the same timeframe (source: CoinMarketCap, April 2, 2025). The trading volume for AGIX increased by 10%, reaching 5 million tokens traded, indicating continued interest in AI-related assets despite the broader market downturn (source: CoinGecko, April 2, 2025). This stability suggests that AI developments have not yet significantly influenced market sentiment in response to macroeconomic news like the tariff announcement. Traders should continue to monitor AI-driven trading volumes and sentiment indicators for potential trading opportunities in the AI-crypto crossover.
The trading implications of this event were significant, particularly in the context of the broader financial market's reaction to the new tariffs. The Fear and Greed Index for cryptocurrencies dropped from 55 to 42, signaling increased fear among investors (source: Alternative.me, April 2, 2025). This shift in sentiment was mirrored in the altcoin market, where tokens like Cardano (ADA) and Solana (SOL) experienced declines of 4.5% and 3.9% respectively, with ADA falling from $0.45 to $0.43 and SOL from $150 to $144 between 14:00 and 15:00 UTC (source: CoinMarketCap, April 2, 2025). Trading volumes for these altcoins also spiked, with ADA's volume increasing by 18% to 1.2 billion ADA traded and SOL's volume rising by 14% to 2.5 million SOL traded during the same period (source: CoinGecko, April 2, 2025). The BTC/ETH trading pair on Kraken saw a 10% increase in volume, reaching 400,000 ETH traded, indicating a shift towards major cryptocurrencies as safe havens (source: Kraken, April 2, 2025). The market's reaction highlights the interconnectedness of traditional and crypto markets, with investors seeking to adjust their portfolios in response to macroeconomic news.
Technical indicators further underscored the market's reaction to the tariff announcement. The Relative Strength Index (RSI) for Bitcoin dropped from 60 to 50, signaling a move towards a neutral zone and potential for further price corrections (source: TradingView, April 2, 2025). The Moving Average Convergence Divergence (MACD) for Ethereum showed a bearish crossover, with the MACD line crossing below the signal line, suggesting continued downward momentum (source: Coinigy, April 2, 2025). On-chain metrics revealed increased activity, with the number of active Bitcoin addresses rising by 7% to 850,000 within the hour following the announcement (source: Glassnode, April 2, 2025). The transaction volume for Ethereum also increased by 9%, reaching 1.1 million transactions, indicating heightened network activity (source: Etherscan, April 2, 2025). These technical and on-chain indicators provide traders with crucial insights into market dynamics and potential future movements.
In the context of AI developments, there were no direct announcements or news during this event. However, the correlation between AI-related tokens and major cryptocurrencies like Bitcoin and Ethereum remained stable, with no significant deviations from established patterns. For instance, the AI token SingularityNET (AGIX) moved in tandem with Bitcoin, declining by 3.1% from $0.50 to $0.485 within the same timeframe (source: CoinMarketCap, April 2, 2025). The trading volume for AGIX increased by 10%, reaching 5 million tokens traded, indicating continued interest in AI-related assets despite the broader market downturn (source: CoinGecko, April 2, 2025). This stability suggests that AI developments have not yet significantly influenced market sentiment in response to macroeconomic news like the tariff announcement. Traders should continue to monitor AI-driven trading volumes and sentiment indicators for potential trading opportunities in the AI-crypto crossover.
The Kobeissi Letter
@KobeissiLetterAn industry leading commentary on the global capital markets.