Will Bitcoin Rise Or Fall Again? QCP Questions Trump-Fueled Rally
Bitcoin soared $95,000 in Sunday’s low liquidity trading after U.S. President Donald Trump made a major announcement. The formation of US crypto strategic reserves, including Bitcoin (BTC), Ethereum (ETH), XRP, SOLANA (SOL) and CARDANO (ADA), has caused the market to emit speculation. Many traders see this as a decisive moment that can cement crypto’s position in the U.S. financial system, while others remain alert, questioning whether rallies can transcend direct reactions. There is skepticism in QCP Capital.
The most timely political Bitcoin game?
The timing of Trump’s announcement is hard to ignore. Risk assets are under increasing pressure over the past week as global markets react negatively to a range of economic and geopolitical developments. Trump’s New imposed tariffs Investors are full of confidence, while the shaky Ukraine-Russia peace talks create additional uncertainty. The intensification of volatility in the stock market has had a serious impact on sentiment in the entire financial sector.
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Bitcoin broke in its multiple months range, showing signs of weakness ahead of Trump’s announcement. The sudden announcement is in stark contrast to what the risk assets follow in the decline trajectory.
QCP Capital Highlight The political strategy behind the move: “For the president who became a market hero, last week’s performance of risk assets was encouraging. His new tariffs and more shaken than expected than Ukrainian-Russia peace talks were investor confidence. So, sbr Surprisingly, the political calculations are clear–Trump needs to win before approval rates start to decline, an indicator he might personally think. ”
However, there has been no question as to whether this move represents a real policy shift or is simply a good announcement aimed at stabilizing emotions. Despite Bitcoin’s rapid rise among exciting traders over the weekend, QCP Capital still doesn’t believe the rally represents a meaningful breakthrough. The company pointed to several major market signals that Bitcoin has not yet emerged from the woods.
QCP Capital warned: “Are we back to the game? Not completely. BTC is still trading near the bottom of its multiple-month range, front-end cryptovols are still relatively high, and both majors still reflect the skew until the end of March. VIX’s risk assets have also risen overall, indicating wider market unrest, especially after the recent tariff escalation by the U.S. government.”
Past Courses: “XI Candle” Comparison
For experienced traders, the weekend’s price action is reminiscent of historical events in the cryptocurrency market – the infamous 2019 XI Candle. The cold-blooded Shiller, a well-known crypto analyst, participated in X for X for comparison.
Reflection on XI Candle, Cold-blooded Shilling recall Bitcoin’s downward trend is extended, trading at fresh lows on market sentiment at the bottom of the rock. Then, Chinese President Xi Jinping announced that China should adopt blockchain technology. The result is a huge short squeeze, with Bitcoin soaring 40% in just two days. Traders thought at the time that this marked the beginning of a new bullish era in crypto.
“Emotions are quickly adjusted. You’ll be surprised (not) to hear that there wasn’t much money then to shape Twitter’s entire mindset into the positivity and ability that is now, allowing the market to gain unlimited bids,” he wrote.
But joy is short-lived. A few weeks later, China has traced its pro-chain comments, slammed the crypto exchanges in a new crackdown and warned investors about the risks of digital assets. Bitcoin’s earnings gradually eroded, and in the following month, the price action reversed and eventually dropped below the prophetic level.
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“We didn’t immediately turn the candle around. It actually took weeks to do that, which made it even more painful for those who trade it or those with bullish bias.
The similarities between Xi Jinping candle and Trump’s announcement of crypto reserves are shocking. Both events saw a huge shift in sentiment almost overnight after long-standing market weaknesses and both created a new bullish narrative that was widely accepted by the market. The key question now is whether the Trump announcement will lead to a persistent trend shift or like the XI candle, which will eventually disappear, leaving the late buyer trapped at the top.
Key Events to Watch This Week
Bitcoin’s ability to keep earnings or extend higher may depend on key macroeconomic and regulatory developments in the coming days.
On Wednesday, the market will receive the latest Purchasing Managers Index (PMI) data, a crucial economic indicator that could impact expectations for Fed policy. If the PMI data shows signs of economic weakness, it could increase speculation about potential slowdowns, which could provide headwinds for risky assets, including Bitcoin. But stronger than expected data could reinforce the view that the Fed will maintain its restrictive policy stance, potentially exerting pressure on crypto and stocks.
On Friday, the Non-agricultural Wage (NFP) report was released, a key employment indicator that has historically influenced market sentiment. Strong employment reports may indicate continued economic resilience, thus reducing the likelihood of a near-term reduction of interest rates, which could negatively impact Bitcoin. Instead, an expected report may fuel risk sentiment, further supporting BTC’s momentum.
Also on Friday, White House Crypto Summit We expect to provide important insights into the future of the U.S. crypto strategic reserve. If tangible announcements occur, BTC may rise further. However, if the event fails to achieve meaningful policy direction, the market may cause negative reactions to increase volatility.
As QCP Capital puts it: “Just when we think Trump runs out of his cards, his sleeves may still bring more surprises. Will this be a push toward this elusive all-time high? We’ll see.”
At press time, BTC traded at $90,352.
Featured Images created with dall.e, Charts for TradingView.com
