Bitcoin trades well above support line while stock markets drop further

According to the best Bitcoin short-term forecaster Arthur Hayes, we have nothing to worry about. He thinks Trump’s tariff war will in the end be good news for Bitcoin (and gold), as the dollar weakens and the Federal Reserve turns on the money printer again. Meanwhile, stock markets are looking bloody red.

“Investors remain in a very defensive mode amid escalating global trade tensions and fears of a potential economic slowdown,” explained Naeem Aslam of Zaye Capital Markets.

Bitcoin, on the other hand, remains well above that important support line at $75,000, so what should we make of this?

Defensive

Donald Trump delivered a huge blow to global financial markets this week, doing exactly what he promised when he announced his import tariffs (although his voters actually expect lower product prices, they are now likely to see stock market losses and higher inflation in the short term).

The most famous American technology stock market, the Nasdaq 100, experienced its biggest price drop ever on Thursday while Friday was not much better. Technically speaking, almost all major Western exchanges are in serious trouble.

In comparison, Bitcoin is not doing too badly. The largest digital currency managed to limit its losses and has been trading between $80,000 and $90,000 for a whole week. The support line around $75,000, where many Bitcoin whales are waiting to buy, is holding up very well.

Will this weekend bring a period of rest or will we test that support line again next week? Much will depend on how the dollar reacts and if the EU will introduce countermeasures.