Bitcoin recovers above 87k – Can the rebound continue ahead of Liberation Day?

• BTC rises above the 200 SMA and holds above 87k. 

• Bitcoin spot ETFs book seven consecutive days of inflows. 

• Optimism surrounding Trump’s trade tariffs supports risk assets. 

• But – BTC funding rate turned negative.  

• April 2, “Liberation Day,” will provide more clarity on direction. 

Bitcoin has extended its recovery from the 77k 2025 low, rising above the key 200-day moving average resistance to a 3-week high of 88.7k yesterday. Today, BTC continues to hold above 87k. 

The recovery in Bitcoin has coincided with a solid rebound in the broader crypto market, with the total crypto market capitalization rising from $2.35 trillion on March 10 to $2.85 trillion today, representing a substantial $400 billion recovery. 

Bitcoin’s price rise comes amid a seventh consecutive day of spot Bitcoin ETF inflows as demand returns following weeks of net outflows. Bitcoin futures open interest also jumped this week as the Bitcoin price rose, validating the buoyant market mood. Meanwhile, Strategy’s Bitcoin holdings have surpassed 500,000, and GameStop has announced that it will also invest in Bitcoin, following Strategy’s lead. 

The move higher in Bitcoin comes alongside gains in US equities, with the Nasdaq 100 trading +2.75% higher this week as the tech-heavy index recovers from a 5-month low. Bitcoin continues to trade highly correlated to the Nasdaq.  

Optimism that Trump’s expected US trade tariff announcements next week will be less severe than initially feared has helped the market mood. The relief that the Federal Reserve maintained its outlook for two rate cuts this year in the March FOMC meeting has also aided sentiment over recent sessions. 

Optimism could be short-lived

However, this rally could be short-lived given that macro uncertainties remain and thin volumes suggest the recovery is fragile. Even if Trump’s reciprocal tariffs are narrower than initially anticipated, there is still potential for tariff escalations and trade wars. Inflation concerns persist, particularly following the Fed’s upward revision of its inflation forecast for this year. Core PCE data, released on Friday, will offer further insights.  

Despite the recent recovery, there are reasons to be cautious. The Bitcoin funding rate turned negative at the start of the week, despite BTC’s price climbing 4%. This suggests that traders are willing to pay to hold short positions, indicating bearish sentiment.  

Liberation Day 

All eyes are on President Trump’s plans for tariffs on April 2, “Liberation Day,” for further clarity on direction. Volatility, which has been relatively calm in recent sessions, could be reignited across risk assets.  

Should Trump adopt a softer stance to tariffs, Bitcoin and other risk sets could rally.  Meanwhile, a stricter stance from Trump could spark a steep decline. Vagueness could also fuel a selloff, given the market’s aversion to uncertainty. 

Bitcoin technical analysis 

Bitcoin has extended its recovery from 77k, rising above the key 200 SMA to 88.8k. The price remains below its multi-month falling trendline, a resistance that buyers will need to rise above to extend the near-term recovery to 90k. A close above here brings 95k into focus. 

Should BTC fail to retake the falling trendline, the price could re-test the 200 SMA. A break below here could open the door to 80k, and below here, 77k comes back into play. 

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