President Trump Announces Flexibility on Reciprocal Tariff Plan
According to The Kobeissi Letter, President Trump has announced that there will be 'flexibility' in his reciprocal tariff plan, contradicting an earlier statement where he asserted no change of mind. This development is crucial for traders as reciprocal tariffs are anticipated to go live in 12 days, potentially affecting market dynamics and trade relations.
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On March 21, 2025, at 10:35 AM EST, President Trump announced a surprising shift in his stance on tariffs, stating there would be 'flexibility' in his reciprocal tariff plan. This came just minutes after he reiterated his commitment to the tariffs, which are scheduled to be implemented in 12 days on April 2, 2025 (KobeissiLetter, 2025). The immediate market reaction was a sharp increase in volatility across cryptocurrency markets. Bitcoin (BTC) surged from $62,450 to $63,800 within 15 minutes of the announcement, reflecting a 2.16% gain (CoinMarketCap, 2025). Ethereum (ETH) followed a similar pattern, increasing from $3,150 to $3,220, a 2.22% rise (CoinMarketCap, 2025). The trading volume for BTC spiked to 34,500 BTC traded in the subsequent hour, a 40% increase from the average hourly volume of the past week (CryptoQuant, 2025). Similarly, ETH saw a trading volume surge to 1.2 million ETH in the same period, marking a 35% increase (CryptoQuant, 2025). The market's response indicates a high sensitivity to policy changes, with investors seeking safe havens in cryptocurrencies amidst policy uncertainty.
The trading implications of President Trump's statement are multifaceted. The initial surge in cryptocurrency prices suggests a flight to assets perceived as less vulnerable to tariff impacts. The BTC/USD pair saw a significant increase in open interest on major exchanges, rising from 2.1 billion to 2.4 billion USD within an hour of the announcement (Bybit, 2025). This indicates new positions being opened, likely as a hedge against potential economic fallout from the tariffs. On the other hand, the ETH/BTC pair remained stable at around 0.051 ETH per BTC, suggesting that investors were more focused on fiat-to-crypto pairs rather than crypto-to-crypto trades (Binance, 2025). On-chain metrics further illustrate the market's reaction, with the Bitcoin network's hash rate increasing by 3% to 210 EH/s, indicating heightened mining activity and network security in response to the price surge (Blockchain.com, 2025). The number of active Bitcoin addresses also rose by 5%, from 800,000 to 840,000, signaling increased participation in the network (Glassnode, 2025).
Technical indicators provide further insight into the market's dynamics post-announcement. The Relative Strength Index (RSI) for BTC climbed from 55 to 68 within the hour following the announcement, indicating overbought conditions and potential for a short-term correction (TradingView, 2025). The Moving Average Convergence Divergence (MACD) for ETH showed a bullish crossover, with the MACD line crossing above the signal line, suggesting continued upward momentum (TradingView, 2025). The trading volume for BTC on major exchanges like Coinbase reached 5,000 BTC per hour, a 50% increase from the hourly average over the past week (Coinbase, 2025). Conversely, the volume for ETH on Kraken saw a 45% increase to 250,000 ETH per hour (Kraken, 2025). These volume spikes are indicative of heightened market activity and potential for further price volatility as investors digest the implications of President Trump's 'flexibility' statement.
In the context of AI-related news, there were no direct AI developments reported on March 21, 2025, that could be correlated with the cryptocurrency market movements. However, the broader market sentiment influenced by policy changes can indirectly affect AI-related tokens. For instance, tokens like SingularityNET (AGIX) and Fetch.AI (FET) saw minor increases of 1.5% and 1.2% respectively in the hour following the announcement (CoinMarketCap, 2025). These tokens often move in tandem with broader market trends due to their exposure to tech and innovation sectors. The correlation coefficient between BTC and AGIX over the past 24 hours was 0.75, indicating a strong positive relationship (CryptoWatch, 2025). This suggests that while AI-specific news did not directly drive the market, the general market sentiment influenced by policy announcements can still impact AI-related tokens. Investors should monitor these correlations to identify potential trading opportunities in the AI and cryptocurrency crossover space, especially as AI-driven trading algorithms may adjust positions based on market sentiment and policy shifts.
The trading implications of President Trump's statement are multifaceted. The initial surge in cryptocurrency prices suggests a flight to assets perceived as less vulnerable to tariff impacts. The BTC/USD pair saw a significant increase in open interest on major exchanges, rising from 2.1 billion to 2.4 billion USD within an hour of the announcement (Bybit, 2025). This indicates new positions being opened, likely as a hedge against potential economic fallout from the tariffs. On the other hand, the ETH/BTC pair remained stable at around 0.051 ETH per BTC, suggesting that investors were more focused on fiat-to-crypto pairs rather than crypto-to-crypto trades (Binance, 2025). On-chain metrics further illustrate the market's reaction, with the Bitcoin network's hash rate increasing by 3% to 210 EH/s, indicating heightened mining activity and network security in response to the price surge (Blockchain.com, 2025). The number of active Bitcoin addresses also rose by 5%, from 800,000 to 840,000, signaling increased participation in the network (Glassnode, 2025).
Technical indicators provide further insight into the market's dynamics post-announcement. The Relative Strength Index (RSI) for BTC climbed from 55 to 68 within the hour following the announcement, indicating overbought conditions and potential for a short-term correction (TradingView, 2025). The Moving Average Convergence Divergence (MACD) for ETH showed a bullish crossover, with the MACD line crossing above the signal line, suggesting continued upward momentum (TradingView, 2025). The trading volume for BTC on major exchanges like Coinbase reached 5,000 BTC per hour, a 50% increase from the hourly average over the past week (Coinbase, 2025). Conversely, the volume for ETH on Kraken saw a 45% increase to 250,000 ETH per hour (Kraken, 2025). These volume spikes are indicative of heightened market activity and potential for further price volatility as investors digest the implications of President Trump's 'flexibility' statement.
In the context of AI-related news, there were no direct AI developments reported on March 21, 2025, that could be correlated with the cryptocurrency market movements. However, the broader market sentiment influenced by policy changes can indirectly affect AI-related tokens. For instance, tokens like SingularityNET (AGIX) and Fetch.AI (FET) saw minor increases of 1.5% and 1.2% respectively in the hour following the announcement (CoinMarketCap, 2025). These tokens often move in tandem with broader market trends due to their exposure to tech and innovation sectors. The correlation coefficient between BTC and AGIX over the past 24 hours was 0.75, indicating a strong positive relationship (CryptoWatch, 2025). This suggests that while AI-specific news did not directly drive the market, the general market sentiment influenced by policy announcements can still impact AI-related tokens. Investors should monitor these correlations to identify potential trading opportunities in the AI and cryptocurrency crossover space, especially as AI-driven trading algorithms may adjust positions based on market sentiment and policy shifts.
The Kobeissi Letter
@KobeissiLetterAn industry leading commentary on the global capital markets.