Cryptocurrencies Still Under Pressure

The past 24 hours have been particularly difficult for the cryptocurrency market. First, the Federal Reserve Chair hinted that an interest rate cut in December may not happen after all, dampening investors’ hopes for cheaper borrowing. Shortly afterward, President Donald Trump announced a reduction in tariffs following a new trade agreement with China.

U.S.–China Trade Deal and Tariff Cuts

During a meeting in South Korea, President Trump and China’s President Xi Jinping reached a one-year agreement focused on trade in rare earth elements and critical minerals. Under the deal, the United States will lower general tariffs on Chinese goods from 57% to 47%, while tariffs related to fentanyl will drop to 10%.

Following the talks, Trump described the meeting as “amazing,” highlighting that China had committed to increasing imports of American soybeans and to curbing fentanyl production. The agreement aims to strengthen economic cooperation between the two nations, with its terms to be reviewed next year. The leaders also announced plans for reciprocal visits in 2026.

Why Are Cryptocurrencies Falling Despite the Agreement?

Even though the trade news was generally positive, the crypto market reacted with declines. Over the past day, Bitcoin has fallen by around 2%, dropping to $108,398. The broader cryptocurrency market has also seen a pullback of more than 4%.

Capital shifting back to traditional markets – The improved U.S.–China trade relationship has boosted confidence in conventional assets such as stocks and bonds. As a result, some investors are moving funds out of crypto and into safer investments.

Uncertainty over the Fed’s next move – Signs that the Federal Reserve may not cut interest rates in December are weighing on the crypto market. Higher rates mean more expensive capital and a lower appetite for risk.

Mixed economic signals – The tariff cuts can also be seen as an effort to stimulate trade amid slowing global growth. This cautious economic outlook is prompting investors to steer clear of high-risk assets like Bitcoin.

Technical weakness – Bitcoin failed to hold above the $110,000 mark, triggering sell orders and accelerating the decline. The RSI at 29.36 indicates oversold conditions, while the MACD confirms sellers remain in control.

Cautious Sentiment as Markets Await U.S. Signals

The combination of a firmer Fed stance and Trump’s tariff cuts has left investors in wait-and-see mode. While the trade deal is good news for the global economy, cryptocurrencies — being riskier assets — tend to lose appeal when markets appear more stable and optimism returns to traditional investments.