Analysts are anticipating significant fluctuations in the cryptocurrency market as Donald Trump prepares for his inauguration, amidst rising inflation concerns and bond yields.
With less than a week to go until Donald Trump’s inauguration, analysts are warning of “heightened volatility” in the crypto market. According to recent reports, similar to the events of 2017, Trump’s impending presidency is already influencing global financial markets ahead of his official swearing-in on January 20.
Inflation continues to be a critical issue for the U.S. economy. Although job growth has outperformed expectations, with non-farm payroll data showing an increase of 256,000 compared to the anticipated 165,000, inflation remains a significant concern. Analysts caution, “While the Consumer Price Index (CPI) appears to be moderating above the 2% target, market participants still expect December’s CPI to exceed the previous reading.”
Concerns are also mounting over Trump’s proposed tariffs on China, which are likely to be implemented gradually. Analysts note that markets are currently forecasting only two rate cuts for 2025 and 2026 as bond yields continue to climb.
“Expect heightened volatility before and after the inauguration as markets digest and adjust to a new term under Trump.”
Despite these uncertainties, there is potential optimism for crypto investors. Analysts point out that Trump’s administration includes individuals known for their crypto-friendly stances, and speculation about imminent, positive executive orders could provide a short-term boost, potentially supporting asset prices.
Nevertheless, analysts urge caution as Bitcoin’s (BTC) resistance level around $90,000 has been tested multiple times, and with rising global bond yields, the upcoming weeks could lead to chaotic and unpredictable market shifts.
