Synopsis: Bitcoin fell sharply from $126,000 to $104,000 as Trump stayed adamant on November 1st tariffs amid US-China trade tensions, sparking panic and deepening uncertainty in the crypto market.
The cryptocurrency market is under fresh pressure as escalating US-China trade tensions trigger a sharp Bitcoin sell-off. The announcement of 100% tariffs on Chinese imports by President Donald Trump, effective November 1, 2025, sparked panic among investors.
Bitcoin plunged from its October 6 all-time high of $126,000 down to lows near $104,000 within days, wiping out roughly $200 billion in crypto market value. This dramatic drop is shaking confidence as market watchers brace for further volatility ahead.
Trade War & Market Turmoil
The US-China trade conflict, reignited by China’s rare earth export restrictions and Trump’s retaliatory tariffs, threatens key supply chains for technology and blockchain mining equipment. China dominates nearly 90% of rare earth elements vital for electronics, and the export curbs have sent shockwaves through tech manufacturing.
The tariff announcement sent the S&P 500 down over 2%, pushing investors away from risky assets like crypto. Over 1.6 million traders faced forced liquidations totaling $19 billion within 24 hours, exacerbating the price freefall. Altcoins like Ethereum and Solana also suffered losses up to 20%, signaling widespread sell-offs amid growing uncertainty.
Market Response and Technical Outlook
Bitcoin’s overnight flash crash drained leveraged positions, driving the price down sharply. Data shows a strong short bias among traders, with significant put options clustered around $110,000 and $100,000 key support levels if the downtrend continues.
Despite this, Bitcoin partially stabilized, rebounding to $111,000–$115,000 by mid-October as immediate panic eased.
Indicators such as the Relative Strength Index (RSI) dipped into oversold territory, suggesting a possible exhaustion of selling pressure but still allowing room for further declines. The crypto market is closely watching whether China escalates retaliation with further export bans or asset dumping, which could send Bitcoin below the $100,000 psychological threshold.
Is Recovery Possible?
History offers hope, as Bitcoin has shown resilience during prior trade tensions. In the 2018 trade war phase, Bitcoin’s price also fell over 20% but quickly recovered with a strong bull run afterward. Experts call the current situation a stress test rather than a cycle end, highlighting Bitcoin’s scarcity and “digital gold” appeal amid geopolitical turmoil.
President Trump’s pro-crypto moves, including integrating crypto assets into retirement plans and meme coin launches, could support upside potential. If US-China talks resume or ease tariffs soon, Bitcoin might bounce back above $120,000 by month’s end.
For now, investors are advised to prepare for continued volatility but also consider buying opportunities amid the fear-driven market dip.
In conclusion, Bitcoin is under pressure from renewed US-China trade hostilities triggered by Trump’s tariff hike and China’s export controls. The market correction has been fierce, but history and technical signals suggest the crypto sector may recover once political tensions ease.
Investors should stay alert to China’s next moves and global trade developments for clues on Bitcoin’s near-term direction. For those holding crypto, this downturn could be a chance to accumulate before the next rally.
Written By Fazal Ul Vahab C H