Crypto Market Volatility Amid US-China Trade Talks
U.S.-China Reach Trade Deal on Tariffs: Anticipating Impact on Cryptocurrencies
The crypto market showed some instability during the long-awaited US-China trade talks held in Geneva, despite the discussions leading to positive statements from both parties. Experts like Santiment caution investors to tread carefully.
This oscillation is seen as a brief pause rather than a permanent resolution in the ongoing trade war. Tensions escalated in April when President Trump increased import tariffs, leading China to retaliate with high tariffs on US goods.
US Treasury Secretary Scott Bessent stated:
"I'm excited to share the breakthroughs we've made in the extensive trade discussions between the US and China. We'll divulge more details tomorrow, but it was a fruitful exchange. President Trump has been informed."
Trade Representative Jamieson Greer also opted to withhold specifics. Greer underscored that the ongoing discourse followed President Trump's declaration of a national emergency due to the $1.2 trillion trade deficit with China.
Greer further noted:
"We believe we've made a considerable stride toward a resolution with our Chinese counterparts."
Santiment: Cautious Optimism
Data from Santiment highlighted an increase in both Asian and US futures markets following the announcements. Investors expanded their positions, betting on the tariffs being lifted. However, Santiment advised crypto investors to exercise caution:
"Should this agreement effectively relieve pressure on exporters and importers, we may witness a vigorous rally across all markets. However, until the specifics are clear, it's crucial to avoid falling victim to the 'buy the rumor, sell the news' pitfall and refrain from overcommitting."
Bitcoin Slips After Brief Rally
After initially surging to around $105,000, Bitcoin shed some of its gains and is now trading around $1,000 lower from that peak. Most large-cap altcoins have also recorded losses over the day.
According to Santiment, conversations about trading strategies have significantly increased for the first time since the market lows last month. Investors are encouraged to remain cautious before the details of the agreement unfold.
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- Despite the positive statements emerging from the US-China trade talks, Santiment urges block chain investors to exercise caution, suggesting that a potential financial breakthrough might lead to a 'buy the rumor, sell the news' scenario, emphasizing the importance of avoiding overcommitment until the specifics of the agreement are clear.
- Amid the instability in the crypto market due to the US-China trade talks, Santiment advises investing in technology like blockchain with a careful approach, warning that even an anticipated resolution to the ongoing trade war could result in a brief market rally, highlighting the need to avoid falling victim to the 'buy the rumor, sell the news' pitfall and reassessing positions only after the details of the agreement are disclosed.
