Bitcoin Eyes $150K as US-China Tariff Truce Ignites Fresh Bull Market Momentum
Bitcoin Price Breaks Out Amid Trade War Easing
Bitcoin (BTC) made a decisive move above the $105,700 mark on May 12, rallying for the first time in four months and reinforcing a bullish continuation setup that now suggests a potential run toward $150,000. This breakout follows a landmark agreement between the United States and China to slash tariffs, calming months of trade-related economic uncertainty and triggering widespread optimism across risk markets.
Over the weekend, US Treasury Secretary Scott Bessent and Chinese Vice Premier He Lifeng finalized a trade accord in Geneva. Under the deal, the US will reduce tariffs on Chinese imports from an exorbitant 145% to a much more manageable 30%, while China will slash duties on US goods from 125% to just 10%. The move, seen as a de-escalation of the long-running trade war, fueled a broader market rally, boosting appetite for high-risk assets like cryptocurrencies.
Source: David Ingles, Chief Markets Editor, Bloomberg
Macro Tailwinds Favor Risk-On Assets Like Bitcoin
As equity markets surged—S&P 500 futures jumped 2.8% and the US dollar gained 0.7%—traditional safe-haven assets such as gold declined, with the precious metal dropping 2.3%. This shift signals a renewed risk-on sentiment among investors, often a fertile environment for Bitcoin and other digital assets.
Bitcoin, known for its high beta and correlation with speculative market behavior, had previously struggled under the pressure of trade tensions and cautious institutional sentiment. The easing of global economic friction now restores confidence and increases liquidity—two key ingredients for major crypto rallies.
Bull Flag Breakout Targets $150,000
From a technical standpoint, Bitcoin has broken out of a classic bull flag pattern on its weekly chart, a bullish continuation formation that usually signals further upside. This setup began forming in January 2025 after BTC hit a peak just under $110,000. A months-long consolidation within a downward-sloping channel followed, acting as a temporary pause in the broader uptrend.
Earlier this May, BTC finally broke out above the flag's upper boundary with supportive volume, confirming the pattern. According to traditional technical analysis, the projected target from a bull flag is derived by adding the height of the initial flagpole to the breakout level—placing Bitcoin’s next potential peak near $150,000.
Momentum indicators back this move as well. The weekly Relative Strength Index (RSI) has climbed above 65, reflecting healthy buying interest without yet entering the overbought danger zone above 70.
Bitwise Warns of Euphoric Sentiment
Despite the bullish structure, some caution is warranted. Analysts at Bitwise Asset Management, particularly European Head of Research André Dragosch, point to the firm’s Cryptoasset Sentiment Index, which has surged to its highest levels since November 2024. Historically, similar spikes in sentiment—seen in April 2022, October 2023, and November 2024—preceded either local tops or periods of sideways price action.
Cryptoasset Sentiment Index. Source: Bitwise
These sentiment readings suggest that although the long-term outlook for Bitcoin remains bullish, short-term corrections could emerge as enthusiasm outpaces fundamentals.
BTC May Revisit $100K Before Further Gains
As of May 12, Bitcoin was retracing slightly from its high above $107,000, and its daily RSI began flashing overbought signals, increasing the likelihood of a short-term pullback. The immediate support level lies near $100,000, a key psychological mark and technical support aligning with the 0.786 Fibonacci retracement level.
If selling pressure intensifies, BTC could test lower exponential moving averages (EMAs), with the 20-day EMA—currently around $97,385—serving as the next crucial support. A firm defense of this level would keep the bullish structure intact, offering another potential entry point for traders aiming for the $150,000 target.
Conclusion: Bullish Long-Term, Cautious Near-Term
Bitcoin's surge above $105,700, driven by a historic US-China trade agreement, has sparked hopes for a sustained rally toward $150,000. A confirmed bull flag breakout adds technical credibility to this view, while improving macro conditions provide a supportive backdrop.
However, rising market euphoria and overbought technical indicators warrant caution. Investors may see a short-term correction or consolidation before BTC resumes its upward trajectory.
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