Main Points:
- Market sentiment driven by renewed US–EU trade tariff concerns weighs on Bitcoin price.
- Hyperliquid trader James Wynn takes profits on a $1.25 billion long and opens a $111.8 million short.
- Technical indicators highlight key support zones around the 2025 yearly open (~$93,500).
- Broader crypto market buoyed by Ethereum’s recent +40 % surge and institutional stablecoin adoption.
- CME futures gap at $107,230 suggests potential re-test and buying opportunity.
Market Reaction to US Trade Tariffs
Bitcoin’s price action came under pressure in the final week of May as headlines about possible 50 % tariffs on EU imports from the US triggered a sharp sell-off in risk assets, including crypto. Data from Cointelegraph Markets Pro and TradingView showed BTC/USD failing to hold the $108,000 mark into the weekly close on May 25, 2025, as traders reacted to escalating trade-war fears.
Commentators noted that initial comments from then-former President Donald Trump—warning of steep levies on tech goods from the EU—caused a knee-jerk drop in Bitcoin, halting price discovery near the recent all-time high of $112,000. Further announcements targeting specific technology imports only added to volatility, prompting market participants to quip that “Trump’s hot air” was becoming a primary driver of crypto sentiment.
Despite the volatility spike, many traders remained unshaken. They argued that short-term panic could offer deeper pullbacks that still conform to a broader bullish trend, urging investors to view dips as buying opportunities rather than trend reversals.
Major Trader Position Shift: James Wynn’s $1.25 Billion Long to Short
The weekend witnessed a dramatic pivot by Hyperliquid’s flagship trader, James Wynn. After accumulating a $1.25 billion long position on Bitcoin, Wynn unwound that exposure amidst the tariff-fueled volatility, booking profits on his bullish bets. Within an hour of closing out 11,637 BTC in longs, he initiated a new short of 1,038.7 BTC (worth approximately $111.8 million) at an average entry of $107,711.1, according to on-chain analytics firm Lookonchain.
This wholesale flip from a record high long to a sizable short was notable not only for its scale but also for its timing. Market observers highlighted that this level of activity during a typically thin liquidity weekend represented a significant conviction shift, reflecting a cautious stance amid broader macro uncertainty. Daan Crypto Trades described Wynn’s maneuver as “a big trade for a relatively illiquid, rocky weekend,” underscoring the potential for larger-than-usual swings coming into the new week.
Technical Indicators and Support Levels
While headlines dominated price moves, on-chain analysts and chart technicians pointed to persistent bullish structures on the daily timeframe. Material Indicators co-founder Keith Alan emphasized that Bitcoin’s macro trendline, alongside the 50- and 200-day moving averages, converged near the 2025 yearly open at approximately $93,500—a zone that has acted as robust support during prior pullbacks.
Alan argued that as long as BTC remains trading above this confluence zone, the long-term uptrend remains intact, even if the weekly close slips another $4,000 lower from current levels. He noted that retesting support often lays the groundwork for further rallies, suggesting that deeper dips could attract fresh bullish capital.
Crypto Tony, another well-followed trader on X, echoed this sentiment, forecasting that a weekend close as low as $104,000 would still be “no issue” for the ongoing bull market. Such commentary has bolstered confidence among hodlers that any retracement remains a healthy component of the broader Bitcoin cycle.
Broader Crypto Market Trends: Altcoins and Stablecoins
Despite Bitcoin’s short-term wobble, other segments of the crypto market displayed strong momentum. Ethereum led an altcoin rally with a meteoric +40 % gain over the same week, breaking key resistance levels and signaling renewed investor appetite for smart-contract platforms. Major funds and institutional players appear to be redeploying capital into ETH, eyeing a potential re-test of its 2024 highs.
Meanwhile, stablecoin issuance and adoption continue to surge. Tether (USDT) and USD Coin (USDC) processed a combined $28 trillion in transaction volume over the past year, underpinning their role as “on-ramps” and settlement layers for professional trading desks. US lawmakers are reportedly drafting legislation to formalize stablecoins as part of the national financial infrastructure, a move that could further legitimize the sector and attract bank custody solutions.
Meta Platforms has also been exploring USDT and USDC integration for payments within Facebook and WhatsApp. This integration, currently in pilot stages, aims to empower creators and facilitate cross-border remittances without traditional FX friction—potentially driving mainstream stablecoin usage among over three billion users across Meta’s networks.
Looking Ahead: CME Futures Gap and Institutional Dynamics
Derivatives markets reveal additional clues about near-term price action. CME Bitcoin futures show a freshly created gap at $107,230—a phenomenon where no trading occurs during the weekend close. Historically, such gaps tend to get “filled” as price revisits the zone, offering tactical entry points for swing traders. Merlijn The Trader highlighted that Bitcoin is likely to retrace to close this gap, presenting another catalyst for a bounce.
Open interest in Bitcoin futures remains elevated at around $79 billion, indicating sustained investor engagement from both bulls and bears. As May options expiry looms, many institutional participants may look to adjust positions, potentially causing volatility spikes around key strike prices like $110,000 and $112,000.
Additionally, miners have shown signs of pausing sales amid improved fundamentals. On-chain data suggests that younger coin movements are at multi-month lows, hinting at diminishing selling pressure from mining operations. If miners continue to hold, the supply side could thin further, supporting higher prices over the medium term.
Conclusion
The weekend’s seismic shift—where a marquee trader closed a $1.25 billion Bitcoin long only to pivot into a $112 million short—underscores the delicate balance between macro headlines and technical underpinnings in today’s crypto markets. US–EU tariff anxieties provided the spark for a sharp 4 % retracement, but foundational bullish factors remain intact:
- Solid Support Confluence: The yearly open near $93,500 and major moving averages provide a firm floor for BTC.
- Derivatives Dynamics: The CME gap at $107,230 and high open interest suggest tactical opportunities for gap fills and expiry-driven moves.
- Broader Market Health: Ethereum’s breakout and accelerating stablecoin usage illustrate capital rotation into growth segments.
- Institutional Signals: Reduced miner selling and growing custodial demand point to supply constraints ahead.
For investors hunting new crypto assets, these developments highlight a market that, despite headline-driven volatility, continues to mature. Dips toward key technical zones may present prime entry points, while attention to derivatives flow and macro policy news remains crucial. As long as Bitcoin sustains above its critical support corridor, the broader bull narrative endures—and traders will be watching closely for the next leg up.
