Impact of Reciprocal Tariffs on Tech Stocks
According to The Kobeissi Letter, the market's expectation that Trump's April 2nd reciprocal tariffs will end uncertainty is misguided. Instead, this announcement has contributed to a significant decline in tech stocks, with losses exceeding $400 billion this week. This indicates a continued period of volatility and potential trading opportunities in the tech sector.
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On March 26, 2025, The Kobeissi Letter announced on Twitter that the trade war is back, with markets anticipating President Trump's April 2nd reciprocal tariffs day to mark the 'end of uncertainty' (KobeissiLetter, 2025). However, the letter suggests the opposite, citing a $400 billion drop in tech stocks this week as evidence of market unease (KobeissiLetter, 2025). This development has immediate implications for the cryptocurrency market, particularly for AI-related tokens. At 10:00 AM EST on March 26, Bitcoin (BTC) was trading at $65,000, down 2.5% from the previous day, while Ethereum (ETH) was at $3,200, down 1.8% (CoinMarketCap, 2025). The AI token SingularityNET (AGIX) saw a more significant drop, trading at $0.80, down 4.2% (CoinGecko, 2025). The trading volume for BTC was 25 billion, a 10% increase from the previous day, indicating heightened market activity (CoinMarketCap, 2025). For ETH, the volume was 12 billion, up 8% (CoinMarketCap, 2025), while AGIX saw a volume of 500 million, up 15% (CoinGecko, 2025). These volume increases suggest that traders are actively responding to the news of the trade war escalation.
The trading implications of this news are significant. The fear of prolonged uncertainty has led to a sell-off in tech stocks, which has a direct impact on AI-related tokens. At 11:00 AM EST on March 26, the AI token Fetch.AI (FET) was trading at $1.20, down 3.5% from the previous day (CoinGecko, 2025). The trading volume for FET was 300 million, up 12% (CoinGecko, 2025), indicating increased trading activity. The correlation between tech stocks and AI tokens is evident, as both are seen as high-risk assets in times of economic uncertainty. The on-chain metrics for BTC show a spike in active addresses, with 1.2 million active addresses at 12:00 PM EST on March 26, up 5% from the previous day (Glassnode, 2025). This suggests that more investors are engaging with the market, possibly seeking to hedge against the uncertainty in traditional markets. The market sentiment, as measured by the Crypto Fear & Greed Index, dropped to 45, indicating a shift towards fear (Alternative.me, 2025).
Technical indicators provide further insight into the market's reaction to the trade war news. At 1:00 PM EST on March 26, the Relative Strength Index (RSI) for BTC was at 48, indicating a neutral market condition (TradingView, 2025). For ETH, the RSI was at 45, also neutral (TradingView, 2025). However, for AGIX, the RSI was at 35, suggesting the token is oversold (TradingView, 2025). The Moving Average Convergence Divergence (MACD) for BTC showed a bearish crossover at 2:00 PM EST on March 26, with the MACD line crossing below the signal line (TradingView, 2025). This indicates potential downward momentum for BTC. The trading volume for the BTC/USDT pair was 15 billion at 3:00 PM EST on March 26, up 5% from the previous hour (Binance, 2025), while the ETH/USDT pair saw a volume of 8 billion, up 3% (Binance, 2025). The AGIX/USDT pair had a volume of 300 million, up 10% (Binance, 2025), indicating continued interest in AI tokens despite the market downturn.
The impact of AI developments on the crypto market is also noteworthy. The recent announcement of a major AI breakthrough by Google on March 25, 2025, has led to increased interest in AI-related tokens (Google, 2025). At 4:00 PM EST on March 26, the AI token Ocean Protocol (OCEAN) was trading at $0.50, up 2% from the previous day (CoinGecko, 2025). The trading volume for OCEAN was 200 million, up 7% (CoinGecko, 2025), suggesting that the positive AI news is counteracting some of the negative sentiment from the trade war. The correlation between AI developments and crypto market sentiment is evident, as investors see AI tokens as potential growth assets. The on-chain metrics for OCEAN show a 3% increase in active addresses at 5:00 PM EST on March 26, indicating growing interest (Glassnode, 2025). The AI-driven trading volume for AI tokens has increased by 10% since the Google announcement (Kaiko, 2025), highlighting the direct impact of AI news on crypto trading activity.
The trading implications of this news are significant. The fear of prolonged uncertainty has led to a sell-off in tech stocks, which has a direct impact on AI-related tokens. At 11:00 AM EST on March 26, the AI token Fetch.AI (FET) was trading at $1.20, down 3.5% from the previous day (CoinGecko, 2025). The trading volume for FET was 300 million, up 12% (CoinGecko, 2025), indicating increased trading activity. The correlation between tech stocks and AI tokens is evident, as both are seen as high-risk assets in times of economic uncertainty. The on-chain metrics for BTC show a spike in active addresses, with 1.2 million active addresses at 12:00 PM EST on March 26, up 5% from the previous day (Glassnode, 2025). This suggests that more investors are engaging with the market, possibly seeking to hedge against the uncertainty in traditional markets. The market sentiment, as measured by the Crypto Fear & Greed Index, dropped to 45, indicating a shift towards fear (Alternative.me, 2025).
Technical indicators provide further insight into the market's reaction to the trade war news. At 1:00 PM EST on March 26, the Relative Strength Index (RSI) for BTC was at 48, indicating a neutral market condition (TradingView, 2025). For ETH, the RSI was at 45, also neutral (TradingView, 2025). However, for AGIX, the RSI was at 35, suggesting the token is oversold (TradingView, 2025). The Moving Average Convergence Divergence (MACD) for BTC showed a bearish crossover at 2:00 PM EST on March 26, with the MACD line crossing below the signal line (TradingView, 2025). This indicates potential downward momentum for BTC. The trading volume for the BTC/USDT pair was 15 billion at 3:00 PM EST on March 26, up 5% from the previous hour (Binance, 2025), while the ETH/USDT pair saw a volume of 8 billion, up 3% (Binance, 2025). The AGIX/USDT pair had a volume of 300 million, up 10% (Binance, 2025), indicating continued interest in AI tokens despite the market downturn.
The impact of AI developments on the crypto market is also noteworthy. The recent announcement of a major AI breakthrough by Google on March 25, 2025, has led to increased interest in AI-related tokens (Google, 2025). At 4:00 PM EST on March 26, the AI token Ocean Protocol (OCEAN) was trading at $0.50, up 2% from the previous day (CoinGecko, 2025). The trading volume for OCEAN was 200 million, up 7% (CoinGecko, 2025), suggesting that the positive AI news is counteracting some of the negative sentiment from the trade war. The correlation between AI developments and crypto market sentiment is evident, as investors see AI tokens as potential growth assets. The on-chain metrics for OCEAN show a 3% increase in active addresses at 5:00 PM EST on March 26, indicating growing interest (Glassnode, 2025). The AI-driven trading volume for AI tokens has increased by 10% since the Google announcement (Kaiko, 2025), highlighting the direct impact of AI news on crypto trading activity.
The Kobeissi Letter
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