Bitcoin Price Tags $86K as Trump Tariff Relief Boosts Breakout Odds
A Weekend Surge, But Cautious Optimism
Bitcoin (BTC) soared to an eleven-day high on April 13, reaching $86,000 for the first time since April 2. The digital asset’s surge closely tracked news of US President Donald Trump’s decision to exclude certain products from ongoing trade tariffs against China, injecting a much-needed dose of optimism into the crypto market.
While the move sent Bitcoin enthusiasts into a frenzy, seasoned traders remained cautious. With traditional markets closed over the weekend, crypto markets were operating with lower liquidity, raising the potential for significant price volatility. Many observed that the breakout occurred during this period of reduced activity, a factor that could limit its sustainability.
“Call me crazy but I don’t think I trust this breakout on $BTC. Low volume, overbought stoch, and on a weekend. If we can remain over 84k through Monday I’ll look for higher but for now this seems sketchy,” Roman, a trader, observed on Twitter, highlighting the importance of observing how the price develops during the coming week.
Technical Signals Point Toward Bullish Momentum
Despite the skepticism, a confluence of technical indicators offered a glimmer of hope for bulls. The 200-day exponential moving average (EMA), a crucial level for long-term price trends, sat at $85,000, and Bitcoin’s price action above this level further strengthened the bullish case.
Furthermore, the relative strength index (RSI), a classic leading indicator, displayed a bullish divergence with Bitcoin’s price. The RSI, which measures the magnitude of recent price changes, continued to print higher lows while the price was forming lower lows. This divergence suggests a potential reversal to the upside, and this pattern has historically preceded bullish rallies in the Bitcoin market.
A Crucial Retest Looms
However, seasoned analyst Rekt Capital cautioned that a sustained rebound hinges on a successful retest of a long-term daily downtrend that has been in place since late 2024. While Bitcoin has closed above this downtrend, it has previously failed to hold its gains during retests.
“Bitcoin has Daily Closed above the Downtrend. Thus, breakout confirmation is underway,” he wrote on X. “However BTC has previously Daily Closed above the Downtrend but failed its retest (a few of the red circles). Retest needs to be successful and it is in progress.”
This retest, which is currently underway, will be a crucial moment for Bitcoin’s trajectory. If the price manages to break through and hold above the downtrend, it could signal a significant shift in market sentiment and potentially kickstart a more sustained rally. However, if the retest fails, Bitcoin might revert back to its downtrend, potentially triggering a sell-off and further price decline.
The coming days will be crucial for Bitcoin’s immediate future. The weekend’s surge fueled by positive economic news offers a potential springboard for a sustained rally, but the retest of the downtrend and the ongoing volatility in the market remain significant hurdles. As always, investors should exercise caution and conduct their own thorough research before making any investment decisions.
