Bitcoin Price Analysis: BTC Drops As Market Uncertainty Returns

Bitcoin (BTC) was back in the red on Monday as Sunday’s rally lost momentum after Donald Trump reaffirmed his intentions to impose tariffs on Canada and Mexico starting March 4. Both countries vowed to retaliate, sending markets into a tailspin. 

The flagship currency is down over 11% in the past 24 hours after dropping from a high of $94,344 to its current level of $82,800, as the hype around the crypto strategic reserve faded after criticism from industry players. 

Spot Bitcoin ETFs Register $74M Outflows

Spot Bitcoin ETFs started the week with continued outflows, shedding just over $74 million on Monday. The development aligns with the capital retreat from the asset, with Bitcoin-focused ETFs registering just one day of inflows over the past two weeks. BlackRock’s IBIT led outflows with nearly $78 million withdrawn. Grayscale’s GBTC also registered significant outflows of over $54 million. However, Ark21Shares ARKB registered inflows of around $58 million, signaling selective investor confidence. 

$980M Wiped Out From Leverage Traders In 24 Hours 

According to data from TradingView, BTC plunged almost 9% on Monday and extended its decline to the current session, wiping out its weekend gains. President Donald Trump’s announcement about the crypto strategic reserve was turned into a short-term “buy the rumor, sell the news” event, wiping out 289,815 positions worth $978 million over the past 24 hours.  Additionally, pressure and waning investor sentiment adversely impacted the crypto market, which is back to pre-Sunday levels, giving up all its gains during Monday’s collapse. 

According to QCP Capital, the sell-off was exacerbated by President Trump reaffirming that tariffs against Canada and Mexico would go ahead on March 4. Both countries vowed to retaliate, spooking markets further. The prospect of an escalating trade war with China also dampened market sentiment after China announced retaliatory tariffs. The surprise inclusion of Ripple (XRP), Cardano (ADA), and Solana (SOL) also divided the crypto community, with the initial euphoria quickly turning into skepticism. QCP analysts stated, 

“This downturn could intensify pressure on Trump, especially after the strong support and donations he received from the crypto community during his campaign. Even the SEC’s latest move — pausing and dismissing enforcement cases against crypto firms — failed to stem the sell-off, underscoring broader risk aversion in the market.”

Economist Peter Schiff called for an investigation into President Trump’s Truth Social posts, claiming they helped pull off the biggest crypto rug pull of all time. Schiff stated that Trump orchestrated a "pump and dump" scheme and demanded to know who had advance notice of the posts in question. 

“Donald Trump, the first crypto President, just helped pull off the biggest crypto rug pull of all time. A Congressional investigation is now warranted to find out the following regarding this pump and dump scheme.”

Bitcoin (BTC) Price Analysis 

Bitcoin (BTC) registered a significant rally over the weekend as it reclaimed $90,000 after Donald Trump announced the strategic crypto reserve. However, market sentiment changed on Monday, erasing all the weekend gains as market experts accused Trump of manipulating the market with the announcement. Market sentiment was also impacted after industry experts criticized the inclusion of ADA, XRP, and even SOL in the strategic reserve. Castle Island Ventures General Partner Nic Carter stated, 

“It's not the job of the government to run an ersatz crypto hedge fund. It's not their job to pick winners and losers.”

Harrison Seletsky, Director of Business Development at Digital ID Platform SPACE ID said the inclusion of ETH and SOL makes sense because of their robust developer activity. However, he argued that XRP and ADA were virtually ghost chains compared to ETH and SOL. 

“In my eyes, it somewhat delegitimizes the whole idea of crypto reserve assets like industry mainstays bitcoin, ether, and Solana.”

Two Prime Digital Assets CEO Alexander Blume called XRP, ADA, and SOL tech companies that happen to have a cryptocurrency. 

“They are very centrally controlled, and ownership is also highly concentrated. These products are constantly changing and adapting to the market whereas BTC is a decentralized product with no single group of owners or controllers and is more akin to gold.”

BTC started the previous week on a bearish note, dropping nearly 5% on Monday to settle at $91,622. Bearish sentiment intensified on Tuesday as BTC fell below $90,000 on its way to an intraday low of $85,985. The price rebounded from this level but could not reclaim $90,000, ultimately settling at $84,129 after a drop of 3%. Sellers retained control on Wednesday as BTC plunged over 5% to an intraday low of $82,081 before settling at $84,129. Despite the overwhelming selling pressure, BTC recovered on Thursday, reaching an intraday high of $87,045 before settling at $84,457, registering a marginal increase.

Source: TradingView

However, selling pressure returned on Friday as BTC plunged below $80,000 and the 200-day SMA on its way to an intraday low of $78,179. However, it rebounded from this level to reclaim $80,000 and settle at $84,362, ultimately registering a marginal decline. Sentiment changed over the weekend as BTC rose just over 2% on Saturday to settle at $86,182. Bullish sentiment intensified on Sunday following Trump’s announcement regarding the crypto strategic reserve. As a result, BTC surged over 9% to reclaim $90,000 and move past the 20-day SMA to settle at $94,322. However, the rally was short-lived as the price crashed on Monday, dropping nearly 9% to $86,201. The current session sees BC down almost 4% and trading at $82,886 as sellers look to push it below $80,000. The RSI was rejected from the neutral level and currently sits at 35, indicating bears have the upper hand. The MACD is also bearish, indicating a potential downtrend for the flagship cryptocurrency.

Disclaimer: This article is provided for informational purposes only. It is not offered or intended to be used as legal, tax, investment, financial, or other advice.