Bitcoin’s Momentum Indicator Turns Bearish Amid Tariff Concerns

Bitcoin’s (BTC) momentum indicator, the MACD histogram, has flipped negative, sparking concerns among traders. The MACD, a widely used technical analysis tool, measures trend strength by subtracting the 26-week moving average from the 12-week average. A bearish crossover below zero often signals weakening momentum, while a positive crossover suggests strength.

Currently, BTC remains range-bound between $90K and $100K, with price action failing to confirm the bearish signal. The indicator had turned bullish in mid-October, coinciding with Bitcoin’s breakout rally. However, its latest shift hasn’t been validated by price movement, making it less significant for now.

Market sentiment is also influenced by macroeconomic factors, particularly U.S. President Donald Trump’s tariff threats. He plans to impose a 25% tariff on steel and aluminum imports, with additional levies on European goods expected. The University of Michigan’s consumer sentiment survey already reflects growing inflation concerns, with one-year inflation expectations rising to 4.3% in February from 3.3% in January.

Higher inflation expectations could limit the Federal Reserve’s ability to cut interest rates. Analysts note that two-year inflation swaps have hit 2.72%, suggesting the Fed might delay rate cuts even if inflation reaches 2%. This could lead to increased bond yields, pressuring risk assets like Bitcoin.

With the U.S. CPI report for January set to release on Feb. 12, traders are closely watching for any shifts in inflation data. If BTC breaks below the key $90K support, the bearish MACD signal could gain more credibility, potentially accelerating downside movement. Until then, Bitcoin remains in a neutral trading range, with price action dictating the next move.