“Bitcoin Stays Above $87K as Dogecoin and SHIB Rally 11% with Traders Eyeing Tariff Developments.”

Bitcoin Steadies Above $87K as Traders Eye Tariffs and Inflation Data

Bitcoin (BTC) held firm above $87,000 during Asian trading hours on Wednesday as market participants remained cautious ahead of key U.S. economic data and the implementation of new tariffs set for April 2. With uncertainty looming, most traders stayed on the sidelines, awaiting further developments.

Broader crypto markets showed muted movement over the past 24 hours, with Solana (SOL), XRP, Binance Coin (BNB), and Ethereum (ETH) posting modest gains of under 3%. However, memecoins outperformed, with Dogecoin (DOGE) surging 5.5%—marking its second consecutive day of gains.

Other speculative tokens, including Pepe (PEPE) and Mog (MOG), also saw increased interest, reinforcing their tendency to act as high-risk bets linked to Ethereum’s price action. Meanwhile, Shiba Inu (SHIB) rallied 11%, benefiting from increased risk appetite and a 228% surge in activity on the ShibaSwap exchange over the past month. Open interest on SHIB futures has climbed more than 20% since Sunday, signaling traders’ expectations of heightened volatility.

Cautious Market Sentiment Amid Economic Uncertainty

Despite recent gains, concerns persist over a potential slowdown in the U.S. economy. A rapid pullback in momentum-driven equity trades has led some institutional investors to adopt a more defensive stance.

“We anticipate a continued, modest market recovery into month-end, with the next major event being Trump’s April 2 ‘Liberation Day’ tariff announcement,” said Augustine Fan, Head of Insights at SignalPlus, in a message to CoinDesk. He added that rumors of a softer tariff policy could help U.S. stocks recover from recent technical damage, potentially igniting a broader global rally as European and Chinese equities also gain traction.

Fan also noted that cryptocurrency remains closely linked to equities in the short term, stating, “We don’t foresee any standalone crypto catalysts for now, but the recent M&A activity involving Coinbase and Kraken strengthens confidence in the long-term uptrend.”

QCP Capital analysts echoed a cautiously optimistic outlook, highlighting that historically, the second quarter—particularly April—has been a strong period for risk assets.

“The S&P 500 has historically delivered an average annualized return of 19.6% in Q2, while Bitcoin has posted its second-strongest median performance during this stretch, trailing only Q4,” QCP said. However, options market data suggests traders remain hesitant, particularly regarding the evolving tariff situation.

Traders Focus on Inflation Data for Next Move

With Bitcoin’s short-term trajectory uncertain, investors are closely watching the upcoming Personal Consumption Expenditure (PCE) report, set for release on March 28. The PCE index, a key gauge of inflation, tracks changes in consumer spending and is a critical factor in Federal Reserve rate decisions.

A higher-than-expected PCE reading could signal rising inflation, increasing the likelihood of interest rate hikes—potentially dampening risk appetite and pressuring Bitcoin prices. On the other hand, a weaker PCE figure could suggest controlled inflation, raising the probability of rate cuts or a more accommodative stance from the Fed, which could support Bitcoin as a speculative asset.

With traders weighing multiple macroeconomic factors, Bitcoin’s next major move will likely depend on how markets react to the upcoming data and geopolitical developments.