Donald Trump’s Trade Wars Return—More Headwind for ‘Struggling’ Altcoins?

• President Donald Trump is likely to impose tariffs on steel and aluminum.
• Altcoins have resisted another downturn, contrary to the last week’s broader impact.
• Analysts expect prices to rise this week irrespective of the macroeconomic events.

The crypto market may be in for another round of turbulence as U.S. President Donald Trump gears up to renew trade wars with additional tariffs on steel and aluminum.

Just one week ago, a broader economic slump triggered a series of liquidations, knocking altcoin prices down by double digits.

While Trump previously paused some tariffs, allowing the crypto market to recover, the potential restart of these trade conflicts raises new concerns.

Trump’s Plan to Reignite Trade Wars

On Feb. 9, Trump indicated he would announce a 25% tariff on steel and aluminum imports.

While the specific countries involved have not been disclosed, Canada, Brazil, and Mexico are likely to be affected, given their status as major suppliers of steel to the U.S.

This move mirrors Trump’s previous tariffs imposed in March 2018, which led to a sharp drop in altcoin prices before a recovery in April.

Altcoins in the Crossfire

The trade tensions sparked by Trump’s earlier tariff impositions had a profound impact on altcoins, with the prices of prominent assets such as Cardano (ADA), Solana (SOL), and Chainlink (LINK) plunging amid global uncertainty.

Even now, many altcoins remain 60% to 90% below their all-time highs. Ethereum (ETH), typically a market leader, has seen a 45% drop from its peak, trading at $2,644 at the time of writing.

Despite this downturn, some analysts believe that altcoins may avoid the heavy selling pressure seen last week.

A short squeeze could even occur if prices rebound, forcing short sellers to buy back positions and accelerating the uptrend.

As noted by Barchart , the rise in retail investor sentiment could play a significant role in this resilience. Positive sentiment across broader financial markets could cushion altcoins from the impact of any renewed trade wars.

Outside of the macroeconomic activity, crypto analyst Michaël van de Poppe posted that he expects altcoins to continue rising this week.

“Good start of the week with upwards momentum after Monday open. I think that we’ll see strong momentum with multiple daily greens ending up erasing the entire liquidation of previous week on Altcoins. If ETH/ BTC goes up, more likely case that the bull has started,” van de Poppe stated .

Forging Ahead

Going forward, it remains uncertain what the trade wars might mean for altcoins in the short term. However, as mentioned earlier, it is unlikely that the prices of the assets would crash as they did the week before.

Still, this does not imply that the value would climb to higher levels. By the look of things, market participants might wait to see what the U.S. president’s next action will be.

Despite the imposed tariffs and counter-tariffs, Trump appears to remain committed to his pro-crypto policies. Although there is no clear direction yet, analysts expect altcoins to benefit from decisions related to the industry later on.

However, altcoins might continue to struggle to sustain upward movement. This does not imply that their prices will collapse further.