Bitcoin traders are seeing greater volatility as frequent tariff announcements by the officials of the US create turmoil in world trade. Large market participants have been confused over the past two months as the trade policies kept changing under the leadership of former US President Donald Trump. According to Swyftx analyst Pav Hundal, if the tariff discussions continue unresolved, the rise of Bitcoin could stop or even reverse rapidly.
Hundal said that monetary policy in the United States is presently very data-dependent when moving to alter interest levels. As inflation is still a concern, the Federal Reserve has decided to keep rates between 4.25% and 4.50% because of economic risk. The prudence is an indication that policymakers are eager to see strong data before changing policies or easing credit conditions.
Bitcoin’s price recently rose to over $104,000, following a sharp recovery from three months of unsteady performance. The recovery happened barely after the US Court of International Trade had halted Trump’s plans to institute large tariffs. Nevertheless, Trump’s latest move to increase steel and aluminum duties to 50% renewed tensions. If such actions keep on, then Bitcoin can drop back to under $100,000.
Bitcoin eyes $120K If Tariff risks subside soon
Hundal pointed out that this policy uncertainty had the potential to postpone reaching the Federal Reserve’s 2% inflation goal within the year. The threat of prolonged trade disputes now weighs more heavily on investors than market fundamentals. Hopes of a decline in inflation could temper risk appetite and stall another advance in digital currencies.
Many analysts believe that if tariff threats ease this month, Bitcoin may hit $120,000 before June ends. Institutional investors are still showing strong interest, especially if U.S. employment numbers fall below expectations. Lower job growth may push the Fed to cut rates sooner, which typically benefits Bitcoin’s price performance.
The weeks ahead are pivotal as the world economy is at a crossroads. The short-term fate of Bitcoin hangs in the balance on decisions made by the policymakers in the US on tariffs and monetary easing. If clarity comes, the market can look towards fresh highs and enhanced confidence among crypto traders at every level.
