Bitcoin is seemingly at another crossroads.

After a volatile week, the cryptocurrency is testing a critical support zone between $82,000 and $84,000, and analysts are split on whether it is the calm before another leg up or the start of a brutal correction.

Bear Trap or Bear Market?

Crypto influencer Kyle Chasse sent alarm bells ringing, cautioning, “If that support is lost, expect a drop to $80K. $77K-78K if we lose that support.” YouTuber Crypto Rover called it a “big danger for all Bitcoin holders” as it slides dangerously close to breaking a crucial uptrend formed in March.

Adding to the suspense, crypto trader Daan Crypto pointed out to his more than 400,000 followers on X that April 2, dubbed “Liberation Day” by U.S. President Donald Trump, could bring unexpected volatility as he imposes new tariffs, including a 25% charge on foreign-made cars and auto parts.

“With April 2nd approaching and potentially some headlines leaking, I wouldn’t be surprised to see some action this weekend,” the investor speculated.

CME Gaps and Brazil’s Big Play

While the short-term outlook seems shaky, a surprising twist is emerging: BTC adoption is heating up. Shortly after video game retailer GameStop announced plans to buy $1.3 billion worth of Bitcoin, a senior official in the Brazilian government revealed that the country is pushing to allocate 5% of its national reserves to the asset, a move that could potentially send shockwaves through the market. Could this be a setup for a huge reversal?

Then there’s the infamous CME gap. BTC recently created a new gap at $84,418, sparking speculation about a potential fill next week. However, traders are divided, with some expecting a violent breakdown and others seeing the situation as a classic bear trap designed to shake out weak hands before a rally. “Two words: bear trap,” fired JAN3 CEO Samson Mow in an X post.

If Bitcoin loses key support, market indicators suggest we could be staring down a brutal correction to the $71,000 level. However, if the bulls defend $82,000, and depending on the market’s reaction to news leaks regarding April 2, a recovery past $90K may not be off the table.

Bitcoin’s relatively positive business week ended on the wrong foot as the asset erased all gains and plunged below $84,000.

The altcoins are also struggling on a daily scale, with ETH dropping beneath $1,900, while XRP is well under $2.15.

BTC Slips to $84K

It all seemed to be going well for the primary cryptocurrency, whose price started to gain traction last Sunday and peaked on Monday. Within that 24-hour period, the asset jumped by several grand and marked a multi-week high of just under $89,000. The ETF inflows had changed for the better, and the overall sentiment had improved.

However, BTC couldn’t break through that resistance and started to consolidate in the next few days, trading mostly in a tight range between $86,000 and $88,000. On Friday, though, the lower boundary gave in and bitcoin slumped beneath it.

It kept going south and dropped to $83,500 for the first time since last Friday. Thus, BTC lost all gains made during the week. As of now, it struggles below $84,000 once again, while its market cap has plunged to $1.665 trillion on CG. The silver lining is its growing dominance over the alts, which has spiked to 59.1% as most have bled out heavily.

Alts Turn Red

As mentioned above, most altcoins have posted notable price declines lately. Ethereum, which challenged $2,100 earlier this week, is below $1,900 now after another drop in the past 24 hours. Ripple’s native token has lost another 4% of value despite the positive news for the company this week. As a result, XRP sits beneath $2.15.

More daily losses come from the likes of BNB, SOL, DOGE, ADA, LINK, TON, SUI, and many others. In fact, the last two have lost over 6% of value in the past day alone.

With most other alts in a similar state, it’s no wonder that the total crypto market cap has dropped to $2.810 trillion – almost $200 billion lower than this week’s peak.

TL;DR

• Was it a classic ‘sell-the-news’ event? It seems so, as XRP’s price has tumbled hard since Brad Garlinghouse’s triumphant announcement last week.
• Is the hype over, or can something bring back Ripple’s cross-border token?

Lawsuit Closure

It all started over four years ago, in December 2020, when the US SEC went after Ripple for selling unregistered securities (XRP) for $1.3 billion. The hit against Ripple was immediate as exchanges delisted the token, while former partners went away.

The following four years were filled with twists and turns, but the company was actually in the lead, at least according to several court rulings that went its way. Moreover, its top two execs were exonerated. The SEC notched a minor win when Judge Torrest ruled that Ripple has to pay $125 million in penalties, but that was far off the $2 billion the agency asked for, which is why it appealed in 2024.

However, that appeal was dropped last week when the company’s CEO, Brad Garlinghouse, announced on X that the case had essentially ended with the Commission’s decision. Ripple’s CLO confirmed that the firm has dropped its own appeal, which marked the end of the lawsuit. Oh, and the company still needs to make a payment to the SEC, but it’s not $2 billion, not even $125 million – only $50 million.

Although the lawsuit’s conclusion is not a landslide victory for Ripple, it sure seems as if the company emerged as the moral winner. So, you would expect a massive surge for XRP, right?

No Surge, Just Correction

As with all major announcements, XRP reacted well to Garlinghouse’s statement last week and went from $2.3 to $2.6 within minutes. While many anticipated this to be the start of a major rally, the reality is entirely different.

XRP lost almost all gains within a day or two and was stuck below $2.5 for a while. However, the market-wide retracement hit the asset hard. As of press time, XRP is down to $2.05, which means that it has lost over 20% of the peak from last week.

Its battle with USDT for the third spot in terms of market cap seems lost, as there’s a $25 billion gap between the two now. Moreover, a popular analyst warned recently that XRP could plunge toward $1.2 if the $2 support is broken to the downside, which is now being tested.

All in all, the signs point that this was a classic ‘sell-the-news‘ event for XRP’s price even though Ripple is winning on multiple fronts.

Nevertheless, certain factors could still reverse the asset’s price trajectory in the following months, such as the potential to have its own ETF in the States or Ripple going public. Or, perhaps, those could have already been priced in, and there’s more pain ahead.