Technical Reversal & Tariff Risks: Why We've Adopted Defensive Positioning

After an impressive rebound from Bitcoin’s dip below $80,000, digital assets face mounting pressure as key technical indicators—Stochastic RSI, Bollinger Bands, and MACD—converge on a reversal signal. While short-term bullish momentum was strong, these indicators suggest that a cool-off period may be imminent.

The divergence in ETF netflows continues to extend its streak, highlighting institutional hesitancy. Bitcoin has now recorded three consecutive weeks of outflows, while Ethereum remains under pressure with persistent outflows despite its recent recovery. Institutional investors’ inertia in asset allocation could keep this trend in place until Bitcoin reclaims key resistance levels at $89K and $91K.

Market momentum crumbled under renewed tariff pressures as Trump doubled down on his aggressive trade stance, now targeting auto tariffs with further escalations expected on April 2nd. This escalating tension is expected to weigh on risk assets over the weekend and into early next week.

Outlook and Positioning

As we correctly anticipated, market momentum has faded, validating our call to reduce exposure. With Trump’s tariff pressure intensifying and the upcoming Core PCE report adding another layer of uncertainty, we maintain a defensive positioning to navigate the near-term volatility.

Portfolio allocation update:

• Overweight Bitcoin (BTC) – Historically resilient during macro uncertainty.
• Neutral Solana (SOL) – Strong performer but vulnerable to risk-off sentiment.
• Underweight Ethereum (ETH) – Institutional outflows and macro risks make it more susceptible to downside pressure.

We strongly recommend reducing overall exposure until clearer signals emerge, as the combination of technical weakness and macro risks increases the likelihood of further downside in the near future.