Bitcoin had a rough period, as it dropped below the $100k. This decline came on the heels of former US President Donald Trump’s February 2 announcement of import tariffs on China, Canada, and Mexico. This drop was in the context of increasing geopolitical tensions between Iran and Israel, adding to market turbulence and uncertainty. Bitcoin has recovered to $105,450 at time of going to press. These gains do not come without concern as analysts are cautious that downside risks may emerge and forecast a $100,000 retest in the works.

Market Reaction to Trump's Policies

Arguably, the most significant catalyst pointing toward an immediate negative reaction in the crypto market was the imposition of import tariffs by Donald Trump. Bitcoin over the last day fell below $100,000 for the first time since six days ago. It had been for quite a while. The announcement injected enormous uncertainty into the market, which hurt investor sentiment as evidenced by a massive sell-off.

Bitcoin almost immediately fell from $104,310 to $103,553 in the first hour following Donald Trump’s Twitter post. This recent sharp drop highlights how sensitive the crypto market is to macroeconomic policies and recent geopolitical developments.

Geopolitical Tensions and Bitcoin's Price

Fourth, the long-simmering conflict between Iran and Israel has helped drive Bitcoin’s price up and down. Heavy artillery, drone, and missile strikes have increasingly been traded between the two countries, fostering a tense and uncertain environment. Because of this, investors are reconsidering their positions in more speculative assets such as Bitcoin. Many analysts are convinced that the continuing turmoil will lead Bitcoin to quickly retest that all-important $100,000 psychological price ceiling.

The wider crypto market has followed Bitcoin’s lead, too, something seen throughout this speculative digital asset space. This volatility serves as a reminder for investors to stay alert and adjust to an increasingly unpredictable market environment.

Analyst Perspectives and Future Outlook

Even with the recent drop, many traders still have an optimistic outlook. They argue that Bitcoin’s extended stay above $100,000 has created the base for a more robust bull market. Yet, safety hasn’t been guaranteed with other analysts concerned about potential downside risks.

"Bitcoin will drop below $100,000 in the coming days." - Doctor Profit

Further declines seem likely, with downside risks signaled by Bitfinex analysts at the $102,000 level. Arthur Hayes was the one who had called for Bitcoin to drop down to $93,000 and the stock market soon after.