Bitcoin (BTC) Price Prediction: Will BTC/USD Recover to $89K to Sustain Bullish Momentum?

Bitcoin whipped around on Tuesday and hit a fresh four-month low but ended the session about 5% higher, snapping a five-day losing streak.

Crypto traders are used to seeing Bitcoin wildly change direction, but even by the token's standards, Tuesday's price action was noteworthy.

Bitcoin price dropped to a four-month low on Tuesday before rebounding to post a 5% gain for the session, snapping a five-day losing streak.

Bitcoin was down 0.3% in the past 24 hours to $79,270.2 by 01:00 ET (05:00 GMT).

The world’s biggest cryptocurrency had hit $76,600 earlier in the session, sliding to a four-month low. But it recovered steadily from those levels through the session.

Bitcoin recovered above the $83,000 level, which is critical for sustaining bullish momentum. Otherwise, the token risks sliding to $74,000 or $62,400, possibly marking the final leg of the bull cycle.

At least that is according to Martin Leinweber, Director of Digital Asset Research & Strategy at MarketVector Indexes and author of "Mastering Crypto Assets."

"The price has yet to establish a bottom; further decline is plausible through April-May 2025," Leinweber said.

Crypto tokens saw distress as over 95% of the top 100 cryptocurrencies were trading below their 90-day moving average.

This was a situation last seen during the Yen carry trade unwinding in August 2024 and June 2023, when Bitcoin was around $30,000 and the market was beginning to rise.

These values typically indicate capitulation ahead of a reversal.

Another sea of red as tariffs trump ceasefire hopes

The story was no different for the S&P 500.

Q1 weakness was common in election years and risk assets such as the S&P 500, which is down 9% from its peak, were struggling now as Quantitative Tightening (QT) continued to play out.

Unless the Fed pivots on QT early, which may be spurred by a 20% decline in the S&P to 5100 or 4,900, then expect more volatility until March options expiry, with April bringing some reprieve.

A decline in exchange volume and $1 billion in liquidations (mainly longs) indicated a lack of strength.

Uncertainty was heightened by recent news regarding Donald Trump (tariffs, strategic reserve delays) and upcoming economic data like CPI & PPI.

If past trends were any indication, we should expect a downturn in March and a possible upturn in April.

A more optimistic setup could occur if Bitcoin manages to stay above the $74,000 level and the S&P 500 rebounds.

But for Bitcoin's bullish momentum to be confirmed, the price had to regain the $89,000 mark.

Similarly, for the S&P 500 to avoid a steeper decline, it needed to close above 5,900.

For now, though, market mood was more glum as the threat of escalating trade wars and recession risks remained in the mix.

US President Donald Trump's volatile new tariff threats and reversals pushed stock prices deeper into the red.

The president's economic broadsides had investors largely dumping shares, and the market hue remained negative as US trading wrapped up on Tuesday.

Wall Street stocks continued their steep slide, adding to the biggest monthly loss as investors grew increasingly concerned about the potential effects of fresh tariff threats on international trade.

Progress toward a truce between Russia and Ukraine briefly helped stocks, but trading remained choppy amid shifting statements on tariffs.

At one point, the Nasdaq rose more than 1% as investors cheered the announcement.

But traders saw mostly red on their screens by the time the day ended, with Trump's decision to raise taxes on Canada's steel and aluminum imports to 50% being a key factor.

That was after Trump took to social media to post in all-caps that Canada was planning more tariffs on U.S. steel, to which he responded that he would "terحدثات