Bitcoin Breaks Lower as Crypto Sentiment Sours on Geopolitical Jitters and Tariff Threats
Crypto markets stumbled late Thursday as traders reacted to a confluence of geopolitical uncertainty and macroeconomic strain, dragging Bitcoin (BTC) below $106,000 and sparking a broad altcoin retreat.
While U.S. stocks ended modestly higher, the divergence in sentiment was stark: Ether (ETH), Solana (SOL), XRP, and Dogecoin (DOGE) posted losses ranging from 5% to 7%, underscoring crypto’s vulnerability to global risk-off triggers.
Middle East Tensions and Tariff Fears Rattle Confidence
President Trump’s warnings about a possible Israeli military strike on Iran and the looming threat of renewed tariffs weighed heavily on sentiment.
“We’ve advised Americans to leave the region,” Trump said, noting the risk of imminent escalation. “Missiles could fly.”
The rhetoric injected fresh anxiety into already fragile markets, prompting crypto traders to reduce exposure quickly — a common dynamic during macro uncertainty.
Crypto’s Fragile Rally Faces Fed, Data Crosswinds
The sell-off came despite softer Producer Price Index (PPI) figures and stagnant jobless claims data — both typically seen as dovish signals. But optimism over Fed rate cuts remains tempered by ongoing political pressure and recession fears.
Continuing claims hit 1.956 million, their highest level in over three years, adding to concerns that the labor market is cooling faster than expected.
Trump once again took aim at Fed Chair Jerome Powell, calling him a “numbskull” and floating the idea of forcing a policy shift if cuts don’t arrive soon.
A Pause or a Pivot? Markets Wait for Clarity
The current downturn comes after several weeks of sustained crypto gains, suggesting some degree of profit-taking and a possible market reset rather than a structural reversal.
“What we’re seeing is classic volatility compression unwind,” said one derivatives trader. “The macro backdrop remains in flux, but core demand hasn’t disappeared — it’s just repositioning.”
Whether Bitcoin can reclaim the $106K level in the coming days may hinge on broader macro clarity — and whether risk appetite returns before deeper technical support levels are tested.
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