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President Donald Trump announced Friday that the United States will impose a 50% tariff on all goods imported from the European Union, starting June 1, citing a complete breakdown in negotiations with the 27-member bloc.

Trump made the announcement on Truth Social, writing, “I am recommending a straight 50% Tariff on the European Union,” and claiming that talks have “gone nowhere.”

This latest escalation landed less than thirty minutes after Trump also threatened Apple, warning the company it must begin manufacturing iPhones in the United States or face a 25% import tax. “If they are not made in the US, a tariff of at least 25% must be paid by Apple,” Trump posted.

The comment triggered an immediate response from markets — Apple shares dropped 3% in premarket trading, and US stock futures fell across the board, with Dow Jones down 493 points, Nasdaq 100 down 1.7%, and S&P 500 sliding 1.3%.

Trump lists grievances as trade officials prepare for face-off

In his posts, Trump accused the European Union of building its foundation on exploiting US trade. He claimed the bloc uses tactics such as “Trade Barriers, VAT Taxes, ridiculous Corporate Penalties, Non-Monetary Trade Barriers, Monetary Manipulations,” and lawsuits against American firms, which he said contribute to a $250 billion trade deficit that he called “totally unacceptable.”

Trump reiterated, “There is no Tariff if the product is built or manufactured in the United States.” The announcement also created pressure on US Trade Representative Jamieson Greer, who is scheduled to meet European Trade Commissioner Maros Sefcovic later Friday.

According to the Financial Times, Greer plans to tell Sefcovic that Brussels’ recent proposals still fail to meet American standards. The EU’s main executive body, the European Commission, declined to comment on the latest developments.

Trump’s new tariff recommendation follows an earlier 20% tariff announcement on April 2nd, which he called part of his “reciprocal” policy approach. But Friday’s 50% figure marked a new level, one that some analysts say could destabilize trade if it becomes law.

Speaking to CNBC’s Squawk Box, Chicago Fed President Austan Goolsbee said, “To go to 10% was going to be the highest tariff rate that we had on the world in 90 years. To go to 50% is a completely different order of magnitude.”

Goolsbee warned that such a decision would likely trigger a stagflationary effect — lowering economic output while raising prices. “That’s the Central Bank’s worst situation,” he said.

Bond yields drop and Bitcoin slips after tariff threat

As traders rushed to dump risk and move into government debt, bond markets across Europe reacted sharply. The German 10-year bund, widely considered the eurozone’s benchmark for stability, fell 8 basis points to 2.56%.

French and Italian bonds also dropped, losing 5 basis points each. Swiss 10-year bonds declined by 12 basis points, reflecting investors seeking safe ground.

Commodities and crypto markets didn’t escape either. Bitcoin, which had recently broken above $111,000, pulled back to $108,500. At the same time, gold prices exploded by over 50%, hitting a high of $3,351.15. The US dollar, already under pressure from domestic inflation concerns, slipped 1%, landing at 99.37 by mid-afternoon.

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An analyst for the market intelligence platform CryptoQuant has predicted that bitcoin (BTC) could experience the “sell in May effect” in the coming months, even as the bull cycle remains unfinished.

According to the report by Oinonen, BTC is expected to have a sideways summer and experience elevated price levels by the last quarter of the year following the sell in May effect.

The Sell in May Effect

The sell in May effect is a concept that refers to the seasonality of traditional finance. The saying is based on the idea that stock market returns are often higher from November to April compared to May through October.

The investment strategy dates back centuries and suggests that stocks perform weaker from May to October; hence, investors should sell their holdings around May and reinvest around October.

The adage dates back centuries and postulates that the best six months of the year for stocks are recorded from November through April, suggesting that investors should sell in May and wait until October to buy again.

While this saying has applied to the stock market majorly, a 2024 report by the cryptocurrency research firm K33 revealed that buying BTC in October and selling in April has accrued cumulative returns of 1,449% between 2019 and 2023, while buying in May and selling in September has recorded a negative return of -29% over the same period.

Bitcoin Still Has More Upside

In line with the postulation of the sell-in-May effect, Oinonen insisted that BTC will see a rally in price by the last quarter of the year. The market has seen a repeat of the positive Q4 seasonality in 2013, 2016, 2017, 2020, 2021, 2023, and 2024.

Also, the CryptoQuant analyst noted that BTC may not experience a deeper price correction in multiple months or even a year. However, macro events and geopolitical tensions could significantly affect risk-on assets, including the leading cryptocurrency.

Meanwhile, Oinonen explained that BTC is currently consolidating around the $97,000 level after reaching an all-time high of $109,000 in January. The possibility of a technical correction still lingers, but the halving cycle is far from over.

Compared to the previous such cycle, where BTC surged 686% between May 11, 2020, and November 8, 2021, the cryptocurrency has only climbed 63% since the latest halving on April 20, 2024. Oinonen said Bitcoin’s power-law model and law of diminishing returns suggest moderate price performance in the future; however, the 63% rally indicates plenty of upside and an unfinished cycle.

The post Bitcoin to See ‘Sell in May Effect’ in Coming Months: CryptoQuant appeared first on CryptoPotato.

According to Odaily, the Executive Director of the Hong Kong International New Economy Research Institute, Fu Rao, has analyzed plans by U.S. President-elect Trump to reshape the regulatory framework for cryptocurrencies. The proposed changes aim to grant the Commodity Futures Trading Commission (CFTC) greater regulatory authority over the $3 trillion digital asset market, while diminishing the jurisdiction of the U.S. Securities and Exchange Commission (SEC). This move is seen as a significant policy shift in the cryptocurrency sector, with potential far-reaching effects on the global crypto market.The regulation of cryptocurrencies in the United States has long faced issues of unclear responsibilities. Under the current framework, the SEC and CFTC regulate the crypto industry through enforcement actions, but the lack of clear legal foundations has led to disputes over their respective jurisdictions. In contrast, the CFTC is known for its more lenient approach to cryptocurrency regulation, earning a reputation as a friendlier regulator within the industry. The CFTC primarily oversees the derivatives market, including futures and options trading, with limited authority over the spot market.The Trump administration's proposal to expand the CFTC's responsibilities would allow it to comprehensively regulate the spot market for digital commodities, including Bitcoin and Ethereum. This initiative is expected to enhance market transparency and provide a clearer legal framework for the development of the digital asset industry.

According to PANews, Bernstein analysts Gautam Chhugani and Mahika Sapra stated in a report to clients on Tuesday that they believe the current consolidation phase of Bitcoin is temporary and offers a buying opportunity before the halving. They maintain that there is an 18-month cross-cycle opportunity for Bitcoin and the entire crypto ecosystem. The market is expected to adjust before the halving, and then the overall bull market is anticipated to continue.

The analysts pointed out that the flow of funds in ETFs is reflexive - higher during uptrends and slower during weaker price trends. However, considering that Bitcoin's price trend has historically consolidated before halving and taking into account its rise after experiencing a large net inflow before the approval of the spot Bitcoin ETF and since its launch on January 11th, the recent price trend is not surprising. The analysts wrote, 'This pullback seems healthy and does not affect our cross-cycle view that Bitcoin will reach a cyclical high of $150,000 by 2025.'

Previously, a Bernstein report expressed increased confidence that Bitcoin would reach $150,000 by mid-2025.

According to CryptoPotato, renowned American author and businessman Robert Kiyosaki has once again expressed his support for Bitcoin (BTC), praising its superiority over traditional assets like gold, silver, and oil. In a recent tweet, Kiyosaki elaborated on why he believes Bitcoin stands out among these assets. He acknowledged his ownership of gold and silver mines along with oil wells, but pointed out a fundamental flaw in these traditional assets. The more they are mined, the more their values are diluted, unlike Bitcoin, which has a fixed supply of 21 million coins.

Kiyosaki’s long-term bullish stance on Bitcoin is well-known, with him consistently advising people to accumulate the cryptocurrency. Recently, he projected that Bitcoin could surge to $300,000 by the end of 2024, showing his optimism about its future prospects. Supporting Kiyosaki’s views, Michael Saylor, the executive chairman of MicroStrategy, recently claimed in a CNBC interview that Bitcoin would ‘eat gold’ in the coming months. Saylor dubbed Bitcoin as ‘digital gold,’ citing its superiority over the precious metal due to its remarkable qualities. According to Saylor, Bitcoin possesses all the positive attributes of gold without any of its drawbacks. He highlighted Bitcoin’s digital transferability, which contrasts with the logistical challenges of transporting gold globally.

Bloomberg ETF analyst Eric Balchunas predicted that spot Bitcoin ETFs are on track to surpass gold ETFs. Balchunas emphasized the ease with which spot Bitcoin ETFs could conquer the yellow metal counterparties, indicating a shifting preference among investors. Nate Geraci, the founder of ETF Store, also recently provided evidence of Bitcoin’s growing dominance. He noted that total flows into nine new spot Bitcoin ETFs over the past two months exceed the total flows into all physical gold ETFs over the past five years. According to Balchunas, since the rollout of spot Bitcoin ETFs in the United States, investors have poured billions of dollars into the product, amassing a collective $55 billion in assets under management (AUM) and facilitating $110 billion in trades since January.