May could be a decisive month for Bitcoin amidst the looming threat of a global recession and rising trade tensions between the US and China. A potential tariff agreement could trigger a new bull market.
Recession Risks for Bitcoin
Bitcoin, testing $97,000 and reaching 64.85% dominance, may face serious consequences due to recent forecasts of a potential recession this summer. A sharp drop in corporate profit margins is expected to negatively impact the cryptocurrency.
US-China Trade Negotiations
The resumption of tariff discussions between Beijing and Washington may significantly influence Bitcoin's price. The end of exemptions on certain Chinese goods could exacerbate trade tensions, and without an agreement this May, Bitcoin could face double-digit losses.
Bitcoin's Prospects in Uncertainty
Despite recession risks, some experts predict bullish potential for Bitcoin. If the cryptocurrency initially corrects alongside risk assets, it may then rebound, similar to what happened in 2020. In a stagflation context, Bitcoin could attract investors seeking protection against inflation.
Thus, Bitcoin wavers at the threshold of an important economic turning point. Awaiting the outcome of trade negotiations, markets are closely observing changes that might either revive Bitcoin to its peak values or precipitate a sharp decline.
