Bitcoin rallies as Trump prepares to launch stablecoin

Bitcoin price rallied on Tuesday, touching the $88,000 mark. If BTC price declines, support can be found at $83,000, while resistance may be encountered at $88,700. 

Ethereum remained flat on Tuesday, trading close to the $2,070 level. If the Ethereum price declines, it may encounter support near $1,930, while if it increases, it may encounter resistance near $2,100.

Bitcoin's price rallied on Tuesday, following a rise in broader financial markets. Major US stock markets gained strength on Tuesday, and investor optimism was transferred to crypto markets as well. In addition, reports that US President Donald Trump is preparing to launch a new stablecoin owned by his family boosted crypto markets. 

Most major cryptocurrencies are under pressure due to concerns that US President Donald Trump’s trade policies may start global trading wars. The uncertainty over Trump’s future policies and trade tariffs generates a risk aversion sentiment, putting pressure on crypto markets. Trump’s tariffs are likely to raise global inflation and lower the economic outlook, thus promoting a risk-averse sentiment that puts pressure on crypto markets. Trump’s economic policies are also raising concerns that the US economic growth will slow down. Many analysts are already expressing concerns that the US will enter a recession.

Trump has announced the creation of a national Bitcoin reserve, stressing his determination to make the US the crypto capital of the world. The US government will cease to sell Bitcoin and will stockpile it instead as a store of value. 

Cryptocurrency prices are also affected by central banks’ interest rates. High interest rates stifle economic growth, putting pressure on crypto markets. The US Federal Reserve kept interest rates unchanged at its policy meeting in March. FOMC policymakers voted unanimously to maintain the federal funds rate to a target range of 4.25% to 4.50%. Markets are pricing in two more rate cuts this year, with the first rate cut in June, while a third rate cut is also considered possible.

BTC/USD 1h Chart

ETH/USD 1h Chart

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Written by:
Myrsini Giannouli

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