It seems that markets are beginning to read the room, as the unwinding of the so-called rules based order – which really was based on a Pax Americana Hegemony, is falling apart. After the 25% auto imports tariffs were announced this week, the so called “Liberation Day”, on April 2, when Trump said he plans to announce reciprocal tariffs to end the days of other nations ripping off the US, or “T “ day is looking to be the next milestone.
No surprise then that safe-haven gold hit a fresh record high on Friday with the futures at $3126 and up more than 18% this year, even as the MSCI index of global shares fell, down 1.58%, and down year to date too, while the STOXX 600 European index fell 0.77% on Friday but is still up 6.79% this year. The SP500 was down 1.97% on Friday erasing -$1 TRILLION of market cap and posted its largest daily decline since March 10th and it’s down 5.11% year to date while the ASX 200 was up 0.16% as the election was announced, but down 2.17% so far this year, all weighed down by worries over a looming trade war sparked by tariff decisions from U.S. President Donald Trump.
With the price of BTC down over 4% this week from weekly highs of $89,000 to $83,654, it really has not value anchor so this may not be the end of the pain for holders of Bitcoin and, of course, other crypto assets, as when the leader falls, others follow.
But sometimes, it only takes one number to shift sentiment on the market, and this time, that number came from the latest inflation report. The price of Bitcoin has now lost a crucial technical support level – the 200-day moving average – after the latest Personal Consumption Expenditures (PCE) data was released, adding more weight to an already uncertain macroeconomic backdrop. For Bitcoin, which tends to struggle in tight liquidity conditions, the break below the 200-day moving average could signal further downside if macro pressures persist. What comes next? That depends on whether inflation slows or if markets have, once again, been too eager to price in victory too soon.
