After only two days of talks on trade in Geneva, Switzerland, the US and China have agreed to cut tariffs. The US has reduced Chinese tariffs to 30%, while China has cut its tariffs on the US to 10%. Bitcoin (BTC) is responding well to the news and is at $104,500 early on Monday.
US and China agree a quick-fire initial trade deal
Following on from the trade battle in which the US applied 145% tariffs on China, and in which the Chinese government responded by imposing 125% tariffs on the US, the conciliatory language coming out of the two-day US/China trade talks in Geneva was in marked contrast.
At the end of the talks on Sunday, Treasury Secretary Scott Bessent, and US trade representative Jamieson Greer reported “substantial progress” had been made. Bessent said that the talks had been “productive and constructive”, and that he wanted to see fair trade between the two countries. Greer added that an agreement was arrived at very quickly, and that it would help to address the US $1.2 trillion trade deficit.
90-day pause on tariffs
More details are already emerging on Monday morning with reports that the tariff cuts will be for a 90-day pause. This comes into effect on 14 May, and a continuation, or lifting, of the pause would presumably only happen if the subsequent trade talks are successful.
$BTC briefly hits top of ascending channel
Source: TradingView
Bitcoin (BTC) has been quite sensitive as more details on the trade agreement are emerging this morning. Initially, $BTC surged upward, hitting $105,700, and looked to all intents and purposes as though it would continue the surge up to the $109,000 all-time high. However, when the 90-day pause news came out, this deflated the price back down to just above $104,000 again.
As can be seen in the 4-hour chart above, the current price action is in an ascending channel. The price may eventually be buoyed up if the $104,250 resistance can be flipped into support. That said, not one 4-hour candle body has been able to close above this resistance level so far.
The Stochastic RSI on this short-term time frame has the indicators at the bottom. The 8-hour is also working its way down. These could signal upside price momentum when the bulls need it, and this could be when the US stock market opens later today.
$BTC closes below last major horizontal resistance
Source: TradingView
Zooming all the way out into the 2-week time frame, it can be seen that the candle body for the last 2-week period closed slightly under the $104,400 resistance. While this wasn’t a perfect state of affairs for the bulls, as long as the current candle is able to hold above and head higher from here, all should be well.
The Stochastic RSI is showing a strong cross-up in the indicators, while the Relative Strength Index at the bottom of the chart is also displaying a cross-up. It will be interesting to see how the traditional market reacts to the US/China trade news, and whether this will spike stocks higher. If so, expect the crypto market to follow suit.
Disclaimer: This article is provided for informational purposes only. It is not offered or intended to be used as legal, tax, investment, financial, or other advice.
