Bitcoin Battles “Death Cross” Amid Tariff Chaos – What You Need to Know This Week

As the global markets grapple with rising uncertainty, Bitcoin is feeling the pressure of mounting trade tariffs and bearish sentiment. This week, Bitcoin faces major challenges, from a “death cross” pattern to the growing threat of market instability resembling past financial crashes. With tariff chaos disrupting both traditional finance (TradFi) and crypto markets, here are the five key points to watch for Bitcoin this week.

BTC/USD 1-day chart with 50, 200 SMA. Source: TradingView

1. Bitcoin Faces “Death Cross” and Support Line Breakdown

Bitcoin’s struggle to maintain its bull market momentum is becoming increasingly evident as it forms a "death cross" on the BTC/USD daily chart. A death cross occurs when the 50-day simple moving average (SMA) crosses below the 200-day SMA, typically signaling bearish momentum. After a sharp drop below the $75,000 mark, Bitcoin has now lost several crucial support levels, including the $69,000 threshold, which was last seen in 2021. Bitcoin’s price action suggests that a macro uptrend test is imminent, with analysts like Kevin Svenson warning that this could be Bitcoin’s last chance to maintain bullish momentum.

Fed target rate probability comparison for May FOMC meeting. Source: CME Group

2. Tariff Turmoil Overshadows Key CPI Data

While the market braces for the release of critical inflation data this week, U.S. trade tariffs continue to dominate the narrative. The U.S. government’s announcement of additional tariffs set to take effect on April 9 is causing significant unrest in financial markets, with widespread panic setting in among traders and investors. The upcoming Consumer Price Index (CPI) and Producer Price Index (PPI) reports are expected to show the impact of these tariffs, which could further disrupt U.S. inflation and affect the Federal Reserve's policy stance. Market participants are increasingly anticipating a potential emergency rate cut, possibly as soon as May, in response to the tariffs' economic impact.

Odds for 2025 Fed rate cut as of April 7 (screenshot). Source: Polymarket

3. Comparisons to “Black Monday” and COVID-19 Crisis

As market sentiment plunges, many analysts are drawing comparisons to previous financial crises, including the “Black Monday” stock market crash of 1987 and the March 2020 COVID-19 crash. Bitcoin’s price action this week reflects a heightened sense of fear, with analysts like Michaël van de Poppe predicting further downside risk. The fear of a broader market collapse is palpable, with major losses seen across Chinese and Japanese stock markets. Traders are eyeing Bitcoin’s next move, with some fearing it could fall as low as $70,000 before any potential rebound.

4. Bitcoin’s Speculative Investors at Risk of Panic Selling

Bitcoin’s speculative investor base—composed of short-term holders (STHs)—is increasingly feeling the heat as their positions fall into the red. The Spent Output Profit Ratio (SOPR) metric, which tracks short-term investor profits and losses, currently sits below breakeven. This indicates that a significant number of short-term holders are realizing losses, a typical sign of market capitulation. Historically, sharp drops in the SOPR have coincided with periods of panic selling, and given the current market conditions, it’s likely that STHs will be the first to exit their positions.

5. Extreme Bearish Sentiment and Record Low Fear & Greed Index

Market sentiment has hit unprecedented lows, with the traditional Fear & Greed Index plunging to a record low of just 4/100, signaling extreme bearishness. This is the lowest reading since the COVID-19 crash, even surpassing the fallout from the FTX collapse. While the crypto Fear & Greed Index is somewhat higher at 23/100, sentiment across both crypto and traditional markets is grim. Despite the widespread panic, some analysts suggest that this could present a buying opportunity for long-term investors, though caution remains critical. Given Bitcoin’s relative strength compared to other risk assets, some believe it could rebound sharply once the bottom is reached.

Conclusion: A Week of Uncertainty for Bitcoin and the Markets

Bitcoin is facing one of its most uncertain weeks in recent memory, with trade tariffs, a death cross on the charts, and investor panic combining to create an atmosphere of volatility. While short-term holders may be forced to capitulate, the long-term outlook for Bitcoin remains under scrutiny. As global markets adjust to new tariff policies, the potential for emergency rate cuts, and rising inflation concerns, Bitcoin’s price action this week will be crucial in determining whether it can rebound or continue its downward trajectory.

Keep an eye on the markets, as Bitcoin’s response to these challenges could set the tone for the rest of the year.