Trump lowers import tariffs: crypto market back in green

2025-05-12 08:15:01

Bitcoin

From May 2 to May 11, Bitcoin rose by 7.6%. The largest cryptocurrency by market capitalization has once again surpassed the $100,000 mark, which it had not done since February 7. Most of the growth—6.4%—occurred during a single trading session on Thursday, May 8.

Source: tradingview.com

On May 7, another meeting of the Federal Reserve System (FRS) took place, during which its chairman Jerome Powell (Jerome Powell) announced that the US key interest rate remains unchanged — in the range of 4.25%-4.5%. Powell remained true to the chosen course despite the obvious discontent expressed by the American president. The main reason for his decision was uncertainty. From the perspective of the head of the FRS, there are currently significant risks of both high inflation and unemployment, so the best course of action would be to simply watch and wait. Initially, investors reacted negatively to Powell’s speech — bitcoin dropped below $96,000. However, the next day, there was a surge above $104,000.

But why was there such a reaction if Powell’s rhetoric was neutral at best, but not positive? The fact is that on May 8, Donald Trump announced that a trade deal with a large respected country would soon be concluded. As it turned out later, it was about Great Britain. Trump promised to reduce duties on cars, aluminum and steel for the island state. For vehicles, the rate should fall from 27.5% to 10% for a quota of 100,000 vehicles. Aluminum and steel will be supplied without taxation at all, and the initial rate on them was supposed to be 25%. In addition, on May 9, Trump hinted that import rates for China would be reduced from 145% to 80%.

The growth of BTC is driven by demand from major players. For example, last week, spot ETFs on Bitcoin once again demonstrated an influx of funds amounting to $599.59 million. A money outflow was only observed on May 6 and amounted to $85.64 million.

Source: sosovalue.com

From the point of view of technical analysis, bitcoin remains in an uptrend. This is supported by the excess of the 50-day moving average (обозначена the blue цветом). But the RSI indicator has climbed into the overbought zone (выше 70%). This indicates a possible imminent pullback. Support and resistance levels: $100,000 and $109,356, respectively. The index of fear and greed has risen by three points compared to May 2. Its current value is 70. This shows that greed still prevails over fear in the sentiment of crypto investors.

Source: tradingview.com

Ethereum

From May 2 to May 11, Ethereum rose by 36.26%. This allowed ETH to rise above $2,500 for the first time since March 3. As with Bitcoin, the rise in Ethereum occurred during the period after May 8, when it gained more than 6% in each of three trading sessions.

Source: tradingview.com

The dynamics of ETH were also largely influenced by Trump’s rhetoric regarding tariffs. However, there were also specific reasons for the improvement in investment sentiment. For example, on May 7, the Pectra update was finally deployed on the mainnet. This enabled the implementation of several new features:

user wallets can now function as smart contracts, and fees can be paid with other tokens;
the number of blob data per block has been increased, which should enhance scalability and reduce transaction fees for layer two solutions;
The maximum balance of validators has increased from 32 to 2,048 ETH.

The indicator of the amount of blocked assets (TVL) in Ethereum protocols increased by 20% over nine days – from $52.1 billion to $62.7 billion. This indicates that user trust in the second largest cryptocurrency by market capitalization is gradually returning.

Source: defillama.com

A rapid growth is also observed in the market for derivative financial instruments. The open interest in Ethereum increased by 40% from May 2 to May 11 — from $21.71 billion to $30.4 billion.

Source: coinglass.com

Interestingly, in spot ETFs for Ethereum, after two weeks of inflows, an outflow of $55.76 million was recorded. While the dynamics were neutral on the first day, investors steadily withdrew money from the exchange-traded funds thereafter.

Source: sosovalue.com

From a technical analysis perspective, Ether is in an uptrend. This is indicated by the price exceeding both the 50-day moving average ( marked in blue ) and the Parabolic SAR indicator ( marked in orange ). Current support and resistance levels are $2,112 and $2,815.2, respectively.

Source: tradingview.com

Chainlink

Chainlink increased by 14.2% from May 2 to May 11. During the week, the cryptocurrency rose above $17, updating its highs in two months. As in the case of bitcoin and ether, all the growth fell on the period from May 8 to May 10.

Source: tradingview.com

The rise of Bitcoin and Ether on May 8 and 9 provoked demand from large players (whales) for other altcoins. According to data from the analytical platform Nansen, the most popular among them became wrapped Bitcoin (WBTC), with an inflow of $11.47 million, while Chainlink took second place with $4.5 million.

Another reason for the growth was the new collaborations. Mint Blockchain — a Layer 2 solution on Ethereum for NFTs — announced a partnership with Chainlink. In particular, it has integrated the cross-chain communication protocol (CCIP). This move will allow Mint to establish reliable and secure communication between different blockchains. The integration of CCIP will enhance the operation of the smart contracts in the ecosystem that are used for asset transfers and data transmission. In turn, Chainlink will expand its market presence and attract new users.

On Tuesday, May 6, representatives of Chainlink announced a new rewards system called “Chainlink Rewards.” Its essence lies in the distribution of project tokens from the Build program among ecosystem participants and LINK stakers. Initially, 4% of STX tokens from the infrastructure firm Space and Time will be distributed. The recipients will be LINK stakers. The Build program aims to support projects in the cryptocurrency ecosystem by providing assistance in market entry, access to various services, and much more.

In terms of technical analysis, Chainlink is in an uptrend. This is evidenced by the price exceeding the 50-day moving average of (обозначена синим). However, the trend is quite weak: the indicator

View Original

This page may contain third-party content, which is provided for information purposes only (not representations/warranties) and should not be considered as an endorsement of its views by Gate, nor as financial or professional advice. See Disclaimer for details.