A series of recent actions by Trump have triggered global market fluctuations. His announcement of advanced weapon provisions to Ukraine through NATO and threats to impose a 100% secondary tax on Russia, along with a 50-day negotiation period, have impacted the crypto market significantly. Bitcoin (BTC) and Ethereum (ETH) prices have fluctuated sharply, leaving retail investors in the crypto space with mixed emotions.
Geopolitical influences: Different performances of cryptocurrencies.
Trump's measures have led to a decline in global market risk appetite, with traditional safe-haven assets like gold and the U.S. dollar index rising, while cryptocurrency trends have diverged.
Bitcoin: Although short-term affected by panic sentiment, its status as 'digital gold' is highlighted. It fell 13% at the beginning of the Russia-Ukraine conflict in 2022, only to rebound rapidly to a new high. This time, Trump's series of actions may accelerate institutional capital inflow, with BTC holdings by institutions like BlackRock and MicroStrategy exceeding twice the daily production of miners, indicating a 'supply and demand imbalance.'
Ethereum: Struggling to perform. Despite its on-chain ecosystem (such as DeFi, NFTs) continuing to expand, investors prefer the higher liquidity and more historically validated BTC amidst geopolitical conflicts. At the beginning of July, ETH briefly fell below the key support level of $2400, and technical indicators show that it needs to break through the resistance zone of $2950-$3000 to regain upward momentum.
Technical analysis: Key levels determine direction.
Bitcoin: After reaching a historic high of $109,000 in June, it is currently consolidating in the range of $105,000-$108,000. The narrowing Bollinger Bands indicate that a market change is imminent. If it breaks through the resistance level of $109,000, combined with continuous inflow of institutional capital, July may see a test of $130,000; if it falls below the support level of $100,000, it could retreat to the range of $90,000-$100,000. Expectations of interest rate cuts by the Federal Reserve, expansion of U.S. strategic Bitcoin reserves, and net inflows into spot Bitcoin ETFs (an additional $4 billion in June) all provide support for the bulls.
Ethereum: After breaking through $3000 in July, it has failed to stabilize, currently oscillating between $2900-$3000. It needs to break through the resistance level of $3000 to open up upward space; if it fails, it may revisit $2700. Expectations of Ethereum ETF approval and increased activity in Layer 2 networks (such as Arbitrum and Optimism) may provide mid-term support.
Institutional attitudes: Significant differences in capital flows.
With rising geopolitical risks, institutions have different attitudes toward the crypto market.
Bitcoin: Becoming the 'new darling of safe-haven assets.' Institutions such as Goldman Sachs and Morgan Stanley have significantly increased their holdings recently, viewing it as a 'digital reserve asset' to combat inflation and geopolitical risks. Although Bitcoin's correlation with U.S. stocks has risen to 0.74, institutions believe its 'non-sovereign nature' still holds unique value.
Ethereum: Relatively 'neglected.' Despite a flourishing ecosystem, institutions tend to prefer Bitcoin. MicroStrategy founder Michael Saylor stated: 'Ethereum is a tech stock, Bitcoin is digital gold.'
Future trend prediction: Opportunities and risks coexist.
Short-term (1-2 weeks): If the geopolitical situation does not worsen, Bitcoin is expected to stabilize around $110,000 and attempt to break through $115,000; if the conflict escalates, it may dip to $105,000. Ethereum needs to closely monitor the $2900 support level; if it falls below, it could trigger a chain sale; if it holds, there is a chance to rebound to $3100.
Medium to long-term (1-3 months): Bitcoin, due to institutional capital inflow, Federal Reserve interest rate cuts, and the delayed effect of the 2024 halving, has a probability of over 60% to break through $130,000 in July, and may challenge $150,000 by year-end. Ethereum needs to break through the $3000 mark and gain institutional ETF support, otherwise it may continue to underperform BTC, but an explosive Layer 2 ecosystem could be key.
Retail investor response strategy.
Conservative: 70% of funds allocated to Bitcoin, 30% held in stablecoins or gold to hedge risks.
Aggressive: Gradually buy the dip when ETH falls below $2900, target price $3000; increase holdings when BTC retraces to $105,000.
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