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Bitcoin Price Plunges 4% Amid Trump’s EU Tariff Threats

Market turmoil gripped Bitcoin (BTC) on May 23rd, as President Trump’s renewed tariff threats against the European Union sent shockwaves through global markets.

The cryptocurrency mirrored the downturn in risk assets, experiencing a sharp 4% decline before partially recovering. This volatility wiped out over $300 million in long positions, highlighting the market’s sensitivity to geopolitical uncertainty.

  • Bitcoin’s price briefly dipped to $107,367 on Bitstamp, before a partial rebound.
  • The $110,000 level now acts as a significant resistance point.
  • Traders are closely monitoring price action to determine whether bullish momentum can be preserved.
BTC/USD 1-hour chart
BTC/USD 1-hour chart. Source: TradingView

Trump’s Tariff Threats Trigger Market Sell-Off

President Trump’s announcement on Truth Social, declaring EU trade talks “going nowhere” and proposing a 50% tariff on the EU, sparked immediate reactions. US stock indices, the S&P 500 and Nasdaq, also experienced significant declines.

This event underscores Bitcoin’s increasing correlation with traditional markets, particularly in response to major economic news. Crypto market participants expressed little surprise, given past instances of tariff-related volatility.

“Our discussions with them are going nowhere!” — Donald Trump, Truth Social

Truth Social Post
Source: Truth Social

Data from CoinGlass revealed significant liquidations, totaling nearly $350 million in 4 hours and exceeding $500 million over 24 hours. Leading traders echoed the sentiment of a market correction driven by headline news.

CoinGlass Liquidations
Total crypto liquidations. Source: CoinGlass

Analysis from The Kobeissi Letter suggested a difficult balancing act for the Trump administration, navigating the delicate interplay between tariff pressure and inflation expectations.

The ongoing situation highlights the importance of closely monitoring both geopolitical and macroeconomic factors impacting the cryptocurrency market. Traders are now focused on whether Bitcoin can successfully break above the $110,000 resistance level to sustain its recent upward trajectory.

Disclaimer: This content is for informational purposes only and does not constitute investment advice.

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