Bitcoin Q1 Struggles: Tariff Impact & Gold Surge Drive Crypto Uncertainty

Bitcoin Struggles Through Q1 as Trade Tariffs and Gold’s Rise Dim Cryptocurrency Prospects

As the curtain closes on the first quarter of the year, Bitcoin (BTC) limps toward the finish line, weighed down by economic headwinds and unsettling macro signals. With its price nursing a 13% loss for Q1, Bitcoin finds itself staring at the possibility of dipping below the significant $80,000 threshold—a psychological level that, once breached, could usher in further bearish momentum. The crypto market is navigating uneasy terrain, with U.S. trade tariffs casting a long shadow over risk assets, stirring volatility, and pushing gold to yet another set of fresh highs. As traditional safe-haven assets flourish, the once-unshakeable confidence in Bitcoin seems to be facing a true stress test.

The gloom hanging over the markets is only exacerbated by the looming geopolitical and economic uncertainty. April 2, ominously labeled “Liberation Day” by former President Donald Trump, emerges as a focal point. This date marks the anticipated rollout of a significant wave of U.S. tariffs, potentially impacting up to $1.5 trillion worth of imports. According to commentary from The Kobeissi Letter, this could represent the most substantial escalation in the trade war to date. They warned, “We believe April 2nd will be the biggest escalation of the trade war to date. Markets are in for a wild week.” Traders and investors alike are preparing for harsh waves, adjusting their expectations, and adopting a cautious stance as global economic tides shift.

A Charting Landscape Painted with Caution

The technical outlook for Bitcoin only deepens the sense of unease. Analysts scrutinizing the charts note that price action heading into April is characterized by ominous patterns such as the “bearish engulfing” candle formation on the weekly chart—an indicator suggesting that bearish momentum may dominate in the near term. Trader HTL-NL hinted at this formation’s significance, commenting, “Let’s see if it plays out,” while fellow trader CrypNuevo focused on a new lower wick, suggesting more downside may be imminent. According to Barchart, even the bigger picture offers little solace: Bitcoin and U.S. equities may soon flash matching “death crosses”, a technical signal where short-term moving averages fall below their long-term counterparts. Historically, these have marked broader trend reversals, but Barchart posited an intriguing counterpoint: “What if price action is red heading into those Death Crosses with the actual Crosses marking the bottom like we’ve seen many times before?”

Exchange data lends further insight into market dynamics. Order book readings from CoinGlass illustrate tightly packed bid and ask liquidity near current price levels, suggesting a war of attrition between buyers and sellers. Meanwhile, CrypNuevo zoomed in on the 50-day and 50-week exponential moving averages (EMA), which are compressing—often a precursor to volatile price swings. “Seeing some compression between the 1W50EMA and 1D50EMA which always leads to an aggressive move,” he observed, implying that while the next movement may take time to manifest, its intensity could be significant. History shows that such technical compression often sets the stage for seismic market shifts.

Macroeconomic Data and a Week of Reckoning

Following the storm signal of tariffs, traditional economic indicators are ready to take center stage. This week promises an onslaught of key U.S. labor data, including job openings, jobless claims, and nonfarm payrolls. All eyes also turn to Fed Chair Jerome Powell, scheduled to speak at the SABEW Annual Conference on April 4. Earlier this year, Powell made it clear that while he acknowledges tariff-related inflation pressures are hard to quantify, the Federal Reserve is in no rush to cut rates. That note of caution still resonates powerfully among Bitcoin traders pining for a return of risk-on conditions. As indicated by CME Group’s FedWatch Tool, markets continue to place their bets on a June rate cut, but that optimism walks a tightrope given the Fed’s steady hand.

A Quarter of Missed Momentum

Despite bursts of excitement, Bitcoin’s Q1 ultimately fell short of bullish expectations, setting an unwelcome milestone. With a 12.7% quarterly decline as per CoinGlass data, this marks the worst start to a year since 2018. By contrast, gold has thrived, consistently hitting record highs and diverting safe-haven seekers away from crypto. For Bitcoin enthusiasts, the comparison stings—especially considering BTC is trading around 30% below its January peak. Yet, Glassnode urges a tempered view, reminding observers that drawdowns exceeding 60% were not uncommon in prior bull markets. “This cycle continues to be the least volatile of all,” the firm noted back in February—a sentiment echoed by trader Daan Crypto Trades, who called the quarter “not horrible” despite the downturn.

Even in the shorter term, March concluded with only a 2.7% decline, offering a semblance of stability. While the broader quarter was a letdown, the monthly metrics signal that this stretch sits somewhere in the realm of historical averages—not a catastrophe, but hardly a triumph.

The MVRV Ratio Warns of Murky Waters

Beneath the price charts lies a deeper layer of market diagnostics, embodied by key indicators like the Market Value to Realized Value (MVRV) ratio. This metric compares BTC’s market capitalization to its realized capitalization, giving a snapshot of holder profitability and overheated conditions. Importantly, the MVRV flashed a red flag in March when its short-term moving average crossed below its long-term equivalent—a phenomenon known as a “death cross.” According to Yonsei Dent of CryptoQuant, “Much like in previous cycles, this cross was followed by a price decline after Bitcoin hit a local peak, reinforcing the MVRV’s effectiveness as a market sentiment indicator.” While the ratio has since cooled off and gravitates toward its historical average, Dent warned that no clear signal of a bottom has yet emerged—urging market participants to remain vigilant for further downside risk.

Still, some long-term optimists remain undeterred. Prior assessments of the MVRV ratio leave room for Bitcoin to pursue new all-time highs in the coming quarters, assuming cyclical behavior holds steady. Yet that optimism remains tightly chained to macroeconomic outcomes, from rates to geopolitical shocks.

Coinbase Premium Offers a Modest Glimmer

One subtle yet encouraging metric has been the resilience of the so-called Coinbase Premium, a gauge representing the price disparity between BTC/USD on Coinbase versus BTC/USDT on Binance. Whereas periods of panic typically drive this premium downward into negative territory, this quarter it has remained largely neutral—a signal that U.S. investor confidence may not be as shaken as price action suggests. CryptoQuant contributor Crypto Sunmoon interpreted this as a sign that “Panic selling is decreasing,” with the premium’s stubborn steadiness hinting at a potential trend reversal.

Historically, a rising Coinbase Premium correlates with increased U.S. demand for Bitcoin—a necessary ingredient for a sustained bull run. While definitive bullish signals remain elusive, the absence of complete capitulation may offer the first whispers of a foundation being rebuilt beneath the surface.

Conclusion: Waiting for the Fog to Clear

Amid a volatile blend of macroeconomic tension, weakening technical indicators, and comparative underperformance to gold, Bitcoin enters Q2 with its path clouded by uncertainty. Tariffs loom as a destabilizing force, particularly as April 2 approaches, while central bank posture and labor data further complicate the outlook. Yet hidden within the noise are signs that the worst may already be behind us—or at least, that the final act of this bearish stretch may be nearing its climax. As ever in crypto, market sentiment hinges on a precarious balance of hope, caution, and the ever-shifting tides of global financial policy.