Bounce Or Drop? What May Holds For Bitcoin

May could change everything for bitcoin. As the threat of a global recession looms and tensions between the United States and China intensify, the market holds its breath. A trade agreement could trigger a new bull run… but a failure could plunge BTC into the red.

Bitcoin Under Pressure: A Recession Looms Over May

While Bitcoin tests $97,000 and reaches 64.85% dominance, headwinds are on the horizon: recession. Indeed, a massive recession could hit BTC as early as this summer, fueled by a sharp drop in corporate profit outlooks, the most significant since 2020. In this context, the development of trade relations between the United States and China becomes crucial for investors.

The resumption of tariff discussions between Beijing and Washington could strongly influence Bitcoin’s price. To this end, the end of exemptions on certain Chinese imports (auto parts, small parcels under $800) could exacerbate trade tensions. And without an agreement this May, Bitcoin could record double-digit losses.

However, this extreme scenario remains unlikely. Both powers have no economic interest in slowing their trade. An agreement, or at least a compromise around a reciprocal 10% tariff, seems more realistic.

Threat or Opportunity?

Despite these recession risks, some experts see bullish potential. Bitcoin could first correct with risk assets before rebounding like in 2020. In a stagflation context, the crypto queen could even attract investors seeking protection against inflation, similar to gold.

However, its current strong correlation with technology stocks makes the outlook more uncertain. As do systemic risks linked to a global economic slowdown, which could heavily penalize speculative assets, Bitcoin included.

Bitcoin wavers as a major economic turning point approaches. Between recession fears and Sino-American trade tensions, its immediate future remains uncertain. Markets are closely watching tariff negotiations, the outcome of which could either revive BTC to its highs or precipitate a sharp decline. May promises to be decisive.