- Bitcoin dropped to $105,500 amid heightened market uncertainty driven by conflicting U.S. court rulings on tariffs and cautious Federal Reserve policy.
- Investors now await key inflation data and a major Bitcoin options expiry that could trigger further volatility.
Bitcoin is under pressure once again as market volatility spikes following a turbulent mix of political rulings, inflation concerns, and a looming options expiry. As of late Thursday, Bitcoin slid 2.2% to $105,500, dragging the broader crypto market into the red. Ethereum also dropped 1.9%, while altcoins like Avalanche and Polkadot suffered even steeper losses of over 5%.
Court Rulings Shake Bitcoin Market Confidence
Market sentiment took a hit after a U.S. court ruling complicated the political landscape. Initially, the court deemed former President Trump’s sweeping tariffs—dubbed “Liberation Day” tariffs—unlawful under the International Emergency Economic Powers Act. This decision briefly offered relief to investors anticipating fewer trade restrictions. However, the relief was short-lived. A federal appeals court later reinstated the broader tariffs, injecting renewed uncertainty and signaling deeper economic and political friction ahead.
This legal back-and-forth has compounded concerns about inflation and growth. Minutes from the latest Federal Reserve meeting revealed that policymakers are closely watching how these contested trade measures could impact macroeconomic stability. Their cautious tone reinforces the prevailing sense of unease across markets.
Inflation Data and Option Expiry Raise Stakes
Investors are also bracing for Friday’s release of the Personal Consumption Expenditures (PCE) index, the Fed’s preferred inflation gauge. Forecasts suggest inflation may slightly ease, with headline inflation expected to fall to 2.2% and core inflation to 2.5%. However, any deviation from these expectations could trigger sharp market reactions.
Adding further tension is the scheduled expiry of over 90,000 Bitcoin options contracts, valued at approximately $10 billion. A majority of the open interest is clustered between $95,000 and $105,000—levels that could define Bitcoin’s next significant move. Traders are expected to aggressively reposition, potentially amplifying volatility through the weekend.
A Fragile but Resilient Outlook
Despite the current selloff, analysts highlight the market’s improving technical foundation and resilient long-term outlook. While short-term signals remain clouded by macro and political uncertainty, the groundwork may be in place for a stronger rebound in the coming months.
For now, Bitcoin and the broader crypto market remain in a holding pattern, cautiously eyeing inflation data, geopolitical developments, and key price levels that could define the next chapter in this unpredictable market.
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