impact

4E: Radical tariff policies severely impact US stocks and the cryptocurrency market, intensifying concerns about a global economic recession

ChainCatcher news reports that, according to 4E monitoring, Trump's tariff plan is much more aggressive than the market expected, triggering strong investor concerns about a full-blown trade war leading to an economic recession. On Thursday, all three major U.S. stock indices fell sharply, with the Nasdaq dropping 5.97%, marking the largest single-day decline since March 2020; the S&P 500 fell 4.84%, and the Dow Jones dropped 3.98%, both the largest single-day declines since June 2020. Major tech stocks plummeted, as tariffs are expected to impact the supply chain, with Apple falling over 9%. The market capitalization of the "Magnificent 7" evaporated by about $1 trillion in a single day, reaching its lowest point since early August last year.The cryptocurrency market also saw a widespread decline. Bitcoin fell from a high of $88,000 before the tariff announcement to nearly $81,000, a significant drop, but still relatively strong compared to tech stocks. Various sectors of the market experienced widespread losses, with the overall cryptocurrency market capitalization dropping nearly 8%. The crypto fear and greed index, which had recovered in March, fell back into the "extreme fear" range.The foreign exchange and commodity markets were also affected, with the dollar index falling 1.61% to its lowest level since October 2024, erasing all gains since Trump's election; the outlook for slowing global economic growth caused oil prices to plummet nearly 7%, marking the largest single-day decline since July 2022. Spot gold prices fluctuated narrowly, remaining basically flat compared to the previous trading day.Trump's tariffs have caused a bloodbath in the financial markets, and the non-farm payroll report for March is set to be released tonight. Before the potential impact of import tariffs on the data, the labor market is expected to remain stable. The market is closely watching Powell's speech, and according to the CME FedWatch tool, traders' pessimism about the U.S. economic outlook has significantly increased the likelihood of an emergency rate cut by the Federal Reserve, with the number of expected rate cuts this year rising from two a month ago to four.

Matrixport: Liquidity indicators may not accurately predict BTC trends; attention should be paid to native crypto driving factors or policy impacts

ChainCatcher news, according to Matrixport analysis, the correlation between the rise in global liquidity and the increase in Bitcoin prices has certain limitations. The global liquidity indicator, measured by the total money supply of 28 central banks (in USD terms), although visually correlated with Bitcoin price trends, has its predictive accuracy questioned due to the non-stationarity of the time series and scale differences.The analysis points out that while the growth of money supply may have a lagging effect on the Bitcoin market, this lag time lacks strong theoretical support. Furthermore, although the correlation between Bitcoin and Nasdaq has slightly increased in recent years, it remains below the 60% peak during COVID, indicating that Bitcoin trading is more driven by its own dynamics rather than acting entirely as a proxy asset for tech stocks.Matrixport believes that the broad consolidation of Bitcoin prices may continue, and solely relying on liquidity indicators to predict market trends may not be reliable enough. In contrast, focusing on native driving factors of cryptocurrencies or macro variables with direct policy impacts (such as political leaders supporting cryptocurrencies) may be more valuable. Although market perceptions may have mathematical flaws, their widespread acceptance could still have a tangible impact on market behavior.
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