The price of Bitcoin has gone on a wild ride over the past few weeks, with analysts attributing the volatility to a mix of recession dreads and tariff anxiety. Although some analysts think Bitcoin has already factored in most of the bearish sentiment, others are sounding caution about the downside risks.
Bitcoin momentarily reached $85,000 on April 1 Tuesday but dropped to $84,000 instantly. This represents the existing uncertainty in the market. Nevertheless, the general direction has been upward, with Bitcoin appreciating by 1.3% in the last two weeks.
Recession Fears and the Performance of Bitcoin
Bitwise crypto management analysts warn that although Bitcoin has probably priced in a lot of recession fears, there is still room for downside if a recession materializes. They point out that the history of Bitcoin during previous recessions has been mixed, falling 50% during the 2020 Covid recession, but still rising over 300% at year-end.
Tariff Uncertainty and Market Sentiment
Goldman Sachs advises the Japanese yen as a recession risk hedge in the U.S. due to its past ability to hold up in risk-off environments. The Bitcoin-Japanese yen (BTC/JPY) currency pair declined 1% on Wednesday, April 2, after it was unable to break above important trendline resistance.
The decline followed President Trump’s plans for new reciprocal tariffs, which may further fuel recession concerns.
Despite the negatives, there also exist indications of possible bullish momentum for Bitcoin. Analysts note a pattern of higher lows, for instance, as it was in past corrections after significant events. It indicates that Bitcoin has already hit its lowest level.
Long-Term Holders Still Committed
Regardless of the price volatility that persists today, long-term holders are holding onto their investments. The report from Glassnode finds investors who got in between 2020 and 2022 unshaken by price swings even when short-term holders are showing greater sensitivity towards prices.
The price of Bitcoin keeps on varying with recession uncertainty and tariff instability restraining the market. Although some analysts forecast a bullish recovery, others warn of further downside threats. The next few weeks will determine the course of the price of Bitcoin.
