A new analysis warns of risks to Bitcoin amid a shift towards safe assets. The BTC price drop reflects global trends.
Bitcoin and Global Trends
According to an analysis from The Kobeissi Letter, there is a global move away from risky assets. Following the introduction of new trade tariffs between the US, Canada, and Mexico, Bitcoin and other cryptocurrencies experienced a significant drop. The BTC/USD rate fell by $10,000 within 24 hours.
Market Response to Economic Events
Amid rising trade war tensions and economic uncertainty, a sharp drop in prices was observed not only in cryptocurrencies but also in the stock market. The S&P 500 and Nasdaq concluded the trading session on March 3 with declines of 1.76% and 2.64% respectively. Meanwhile, gold continued to consolidate near its all-time highs.
Bitcoin and Bull Market Support Lines
Bitcoin is approaching the 200-day simple moving average (SMA) — a classical bull market support line. However, Bitcoin's future behavior remains at risk as the largest historical gaps in Bitcoin futures have been closed.
Bitcoin faces challenges as the global preference for safe assets grows. While gold continues to strengthen, Bitcoin is losing its role as a safe haven, indicating changing market conditions.
