Crypto Sentiment Recovers Despite Liquidity Concerns

Crypto investor sentiment has made a strong comeback following concerns over global tariffs, though analysts caution that underlying market vulnerabilities could still trigger downward pressure during periods of weekend illiquidity.

Risk appetite among crypto investors seemed to recover this week after US President Donald Trump took a more conciliatory tone, suggesting that import tariffs on Chinese goods might “come down substantially.”

Still, the improved sentiment “does not guarantee that Bitcoin will avoid volatility over the weekend,” analysts from Bitfinex exchange told Cointelegraph:

“Sentiment improvements reduce fragility, but they do not eliminate structural risks like thin weekend liquidity.”

“Historically, weekends remain vulnerable to sharp moves — especially when open interest is high and market depth is low,” the analysts added, noting that sudden macroeconomic developments could still drive volatility during low-liquidity windows.

Bitcoin recovered nearly 11% over the past week, though its rallies have often been restricted by liquidity challenges typical of Sunday trading.

Bitcoin’s price dipped below $75,000 on Sunday, April 6, despite initially resisting the US stock market’s $3.5 trillion decline on April 4, after Federal Reserve Chair Jerome Powell warned that Trump’s tariffs could impact the economy and push inflation higher.

The sharp correction was worsened by the lack of weekend liquidity and Bitcoin's status as the only major liquid asset readily available for de-risking at the time, industry sources told Cointelegraph.

Despite the sentiment improvement, caution is still warranted, according to Marcin Kazmierczak, co-founder and COO of blockchain oracle firm RedStone:

“While improved sentiment creates a more stable foundation, cryptocurrency markets are still susceptible to rapid movements during periods of reduced trading volume,” he told Cointelegraph, adding:

“The sentiment recovery provides some cushioning, but traders should remain cautious as weekend liquidity constraints can still amplify price movements regardless of the current market mood.”

According to Aurelie Barthere, principal research analyst at crypto intelligence platform Nansen, the crypto market may have already absorbed the worst of the tariff-related anxieties.

“It feels like we’ve maxed out on tariff-related fear,” she told Cointelegraph, adding:

“While many remain uncertain about where things are headed over the next month or so, it also seems like markets were just waiting for the slightest signal that we’re back in the game.”

“Whether the rally is sustainable depends on whether we can break through previous resistance levels, at least in isolation. It could have legs, as markets now seem to believe there’s a ‘Trump put’ under equities, the US dollar and US Treasurys,” Barthere added, while warning that volatility could increase with the upcoming negotiations.

Nansen previously estimated a 70% likelihood that crypto markets would bottom out and begin recovering by June, though the timeline is expected to hinge on the outcome of the ongoing tariff talks.

Raoul Pal, founder and CEO of Global Macro Investor, suggested that the tariff negotiations may primarily be “posturing” as the US seeks to secure a broader trade agreement with China, which he described as the “big prize” for the Trump administration.

Sources:

https://cointelegraph.com/news/crypto-market-structural-weekend-risks-tariff-calm

https://www.theguardian.com/us-news/2025/apr/22/trump-china-tariffs