Despite Disappointing Q1 Performance, Bitcoin (BTC) and Ether (ETH) Remain Bullish Heading Into Q2

With just over a week to go until the end of March, the first quarter has been disappointing, particularly in terms of price action rather than narrative

With just over a week to go until the end of March, the first quarter has been a disappointing one, particularly in terms of price action rather than narrative for the crypto industry.

Bitcoin (BTC) has dropped 10%, its worst first-quarter performance since 2020, and ether (ETH) has posted the weakest opening three months of the year since the world's second-largest cryptocurrency launched in 2015. So far, bitcoin has been relatively steady in March.

Markets remain in the latter stages of President Donald Trump’s first 100 days in office, a period historically marked by uncertainty and volatility. This is expected to persist at least through the end of April.

As quarter-end approaches, negative liquidity and position management could lead to increased volatility and whipsaw price action, according to the London Crypto Club, founders of a trading newsletter.

Despite short-term weakness, the pair maintain a bullish outlook heading into the second quarter. A slightly more dovish tone from the Federal Reserve at its March meeting — even without actual rate cuts — combined with a weakening U.S. dollar, increased fiscal spending in the European Union and a U.S. economy that is slowing but not collapsing, are all factors they say will support a strong three months.

Bitcoin began to sell off on Thursday following Trump’s lack of a concrete update on a bitcoin strategic reserve or a tax-free crypto capital gains policy.

“Market participants were hoping for a tax-free capital gains framework or a bitcoin national reserve accumulation plan,′ said the analysts at Blockhead Research Network (BRN). “Instead, Trump reiterated his general support for the crypto industry, highlighting the role of stablecoins in maintaining the U.S. dollar’s dominance in global trade. While supportive in the long term, the lack of immediate policy commitments is a short-term bearish signal.”

BRN sees digital assets struggling to sustain breakouts, with accumulation continuing at lower levels, particularly for altcoins.

“Despite near-term weakness, we recommend staying heavily invested, as the market could react swiftly to the next positive development. Support levels are not far from current prices,” BRN told CoinDesk in an email. Stay alert!

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