Bitcoin Holds Near $111K as China Trade Tensions Weigh on Market
Bitcoin (BTC) traded around $111,000 Thursday afternoon Hong Kong time, remaining steady after a period of volatility, as China’s latest retaliatory trade measures against the U.S. fueled caution across global markets.
Analysts highlight that Bitcoin’s correlation with gold has climbed to a multi-year high of 0.9, reinforcing the “digital gold” narrative, as both assets often move in tandem during geopolitical shocks.
The broader cryptocurrency market showed caution, with total capitalization hovering around $3.8 trillion. Major tokens held near recent levels: Ether (ETH) near $3,940, BNB at $1,180, Solana (SOL) above $190, while DOGE outperformed with a 4% daily gain and a 21% weekly rise.
The recent pullback is being interpreted as digestive rather than panic-driven, following last week’s record $19 billion liquidation event. On-chain analytics firm CryptoQuant described it as a “controlled deleveraging,” indicating measured market adjustment rather than a full-blown sell-off.
Sentiment data reflect cautious optimism. The FxPro fear index slipped to 34, with traders defending the $109K–$110K range, which has served as a base since August. FxPro analyst Alex Kuptsikevich said, “The bears seem to have had their fill. Potential buyers are waiting for clearer reasons to add risk, and trade tensions aren’t that reason yet.”
On-chain metrics remain constructive. CryptoQuant’s Ki Young Ju emphasized Bitcoin’s strong correlation with gold, highlighting its growing role as a store of value amid macro uncertainty.
Ethereum developments also point to long-term confidence. Developers progressed with testing the Fusaka upgrade on Sepolia, while Bhutan confirmed plans to migrate its national digital ID system from Polygon to Ethereum by early 2026, signaling institutional trust in Ethereum’s infrastructure.
Institutional flows continue to support markets. Nassar Achkar, Chief Strategy Officer at CoinW, said, “Despite historic deleveraging, structural demand for Bitcoin and Ethereum remains intact. ETF inflows and stablecoin supply growth continue building liquidity—what matters now is how quickly that translates into new risk-taking.”
Traders remain attentive to macro catalysts, including Trump’s tariff rhetoric and Powell’s upcoming remarks. Nick Ruck of LVRG Research noted, “Rate cuts are on the table, but tariff fears are limiting upside. Bitcoin’s long-term value draws investors, but macro headlines keep short-term movements choppy.”
For now, the $110,000 support level is the key zone to watch. A decisive break below could shift sentiment from cautious to defensive, potentially shaping Bitcoin’s next major move.
