Crypto, Global Stock Markets Shake Off Historic Rout With Surprise Rally

Key Takeaways

• Bitcoin briefly surpassed $80,000 after a sharp decline to five-month lows due to President Trump’s aggressive tariff plans.
• Other cryptocurrencies and stock markets followed Bitcoin’s lead, rebounding off their recent lows.
• However, experts say the only certainty is high volatility.

After a tumultuous few days, cryptocurrencies found a glimmer of hope, led by Bitcoin (BTC) and stocks’ rise on Tuesday morning.

However, this rebound comes with caution, as market sentiment remains fragile amidst President Donald Trump’s aggressive tariff plans, which have already rocked global risk assets.

While assets bounce back, the lingering threat of more volatility and the looming “death cross” for Bitcoin adds to the uncertainty.

Crypto Rebound After Nightmare Selloff

Bitcoin rose by 5.7% to $79,673.50 on Tuesday morning, briefly topping $80,000, as traders bought the dip after a slump to five-month lows.

The rebound mirrored a broader market recovery, though sentiment remains fragile amid President Trump’s aggressive tariff plans.

Bitcoin had fallen 4.2% over two days after Trump unveiled sweeping reciprocal tariffs, including threats of harsher duties on China.

Despite the bounce, Bitcoin confirmed a technical “death cross ” this week—its 50-day moving average dropped below the 200-day average—suggesting potential near-term weakness. Some long-term holders were also seen moving coins onto exchanges.

Other cryptocurrencies followed Bitcoin’s lead:

• Ethereum (ETH) rose by 3% to $1,585.96 after hitting a two-year low.
• XRP jumped 6.9% to $1.8857.
• Solana (SOL), Cardano (ADA), and Polygon (POL) gained 7% to 9%.
• Dogecoin (DOGE) added 6.8%, while the $TRUMP token increased from near-record lows.

Global Stock Markets See End of Tunnel

In line with cryptocurrencies, global stocks rebounded on Tuesday after three days of turmoil sparked by Trump’s tariffs.

European stocks rose after the bell, with the Stoxx Europe 600 up 1.7%, the FTSE 100 gaining 1% and Germany’s DAX climbing 1.2%.

In New York, futures for the S&P 500 and Nasdaq Composite rose by 1.5% and 1.2%, respectively, following Monday’s flat close. They had steeply declined last week due to Trump’s tariff announcement.

In Asia, Japan’s Topix surged 6% after trade talks with the U.S. were agreed upon, while China’s CSI 300 rose 0.7%, and Hong Kong’s Hang Seng edged down 0.2% after earlier gains.

Gold regained favor after dropping to a near four-week low, likely due to profit-taking following its recent rally.

The fundamental demand for the precious metal remains strong as investors turn to it as a safe haven amid the volatility affecting equity markets.

Volatility Remains the Only Certainty

Despite Tuesday’s positive start, the question remains whether the recent downtrend has reached its bottom.

Matt Britzman, Senior Equity Analyst at Hargreaves Lansdown, cautions that high volatility is likely to persist.

“Yesterday was a wild ride for U.S. markets, opening sharply lower before staging an intra-day recovery, with the Nasdaq closing in the green,” Britzman told CCN. “With company earnings just around the corner, which may provide a welcome distraction.”

However, he noted that management teams are facing tough decisions in navigating the tariff storm. “Expect cautiousness, and possibly even a lack of quarterly guidance in some cases, as uncertainty takes center stage.”

Britzman emphasized the importance of diversification and maintaining a long-term perspective during such volatile times.

Chris Beauchamp, Chief Market Analyst at IG, observed that a recovery in risk appetite was almost inevitable after the prior week’s selloff.

“Sentiment remains fragile, and with China pledging to fight ‘to the end‘ and the EU announcing fresh tariffs (albeit delayed for now), we are not out of the woods yet. The focus is now on the data to see how tariffs affect the economy,” the analyst noted. 

For Beauchamp, this week’s U.S. inflation report may be too early to draw conclusions, but with earnings season approaching, there will be an opportunity to see how companies are “adjusting to the new reality.”