Bitcoin Price Stability

Bitcoin remained steady above $87,000 in Asian afternoon hours on Wednesday. Traders are keenly monitoring U.S. data releases and the upcoming U.S. tariffs, effective April 2, leading to a mostly wait-and-watch stance.

Market Movements

In the past 24 hours, major cryptocurrencies saw little change. However, Solana’s SOL, xrp (XRP), BNB Chain’s BNB, and ether (ETH) rose by under 3%. The memecoin dogecoin (DOGE) outperformed, jumping 5.5% for the second consecutive day, alongside gains in pepe (PEPE) and mog (MOG), showing a trend of these tokens acting as a “beta bet” on ether’s strength.

Shiba inu (SHIB) surged 11%, driven by increased interest in riskier memes and a 228% rise in its native ShibaSwap exchange over the last 30 days. Open interest on SHIB-tracked futures has increased over 20% since Sunday, indicating expectations for further volatility.

Economic Concerns and Market Forecasts

Despite these gains, concerns about a U.S. economic slowdown persist. The unwinding of momentum trades has led money managers to adopt a defensive stance.

Augustine Fan, Head of Insights at SignalPlus, expressed expectations for a soft market rebound as April nears, pointing to the April 2 ‘liberation day’ tariff announcement as a potential catalyst. Rumors of a softer tariff response may aid in recovering losses in U.S. stocks, potentially sparking a global rally alongside rising EU/China stocks.

Fan also stated that cryptocurrencies will likely mirror equity trends in the near term due to a lack of unique catalysts, though recent M&A announcements (like Coinbase/Kraken) bolster long-term bullish sentiment.

Traders at QCP Capital noted that historically, the upcoming quarter, especially April, has been one of the best periods for risk assets. The S&P 500 typically sees an average annualized return of 19.6% in Q2, with Bitcoin having its second-best performance during this time.

Options Market and Economic Indicators

However, options markets remain cautious, with no significant shift toward calls. Attention is turning to the Personal Consumption Expenditure (PCE) data, which can significantly influence Fed interest rate policies and subsequently impact Bitcoin prices. The next PCE release is on March 28, potentially swaying market sentiment as traders adjust their positions based on expected Fed actions.

Conclusion

Bitcoin’s future movements will likely be tied to the development of U.S. tariffs and PCE data, which could either dampen or support its price as an inflation hedge or speculative asset.