Bitcoin drops 8%, US markets shed $2T in value — Should traders expect an oversold bounce?

Bitcoin (BTC) The US stock market has been awash with sharp losses after US President Donald Trump shocked financial markets when he announced a list on reciprocal tariffs against several countries.

On April 3, the S&P 500 saw a 4.2% drop at market open, its most significant single-day decline since June 2020. Dow Jones Industrial Average dropped 3.41% from 42225.32 down to 40785.41, and Nasdaq Composite was down 5.23%. At the opening of US markets, US stocks lost $1.6 trillion.

Bitcoins’ value fell by 8 percent, but bulls appear to be able to defend the support level of $80,000. This steep drop is due to uncertainty over the new tariffs. Investors are also concerned about an imminent recession.

CoinGecko Data suggests The total crypto market is down 6.8% within the last 24 hours, and it’s unlikely that there will be a rally in the near future.

Related: Bitcoin price risks drop to $71K as Trump tariffs hurt US business outlook

Cryptoliquidations Soar To $573M

CoinGlass states that more than 200 000 traders liquidated their positions in the last day, totaling $573.4 millions. Binance was the site with the largest liquidation, where a ETH/USDT trade worth $11.97mil.

Bitcoin’s open interest fell below $50 Billion, which reduced market leverage. JoaoWedson, CEO at Alphractal mentioned The liquidation heatmaps show that Bitcoin is at a high level of leverage, around $80.000. This could lead to a drop as low as $64,000-$654,000 if Bitcoin breaches this trading volume.

Related: Trump ‘Liberation Day’ tariffs create chaos in markets, recession concerns

This article contains no investment recommendations or advice. Each investment or trading decision involves some risk. Readers should do their own research before making any decisions.