Ethereum Struggles Against Donald Trump's Tariffs

In the context of global economic policies undergoing significant changes, Ethereum (ETH) has experienced a notable decline after President Donald Trump announced new tariffs on European goods. This event not only strongly affects the leading cryptocurrency but also emphasizes the increasingly profound relationship between the crypto market and macroeconomic factors. Tax announcement and market reaction During the second term internal meeting, Trump officially announced plans to apply a 25% tax rate on products from Europe, including cars and other consumer goods. Although tax measures for Canada and Mexico may be postponed until April 2, this information has created significant pressure on the global financial markets. Immediately after the information was announced, the price of ETH decreased by 7% in just 24 hours and reached a 15% decrease in the past week. Investors quickly 'cut loss' out of concern that this price decline trend will continue, leading to an estimated loss of about 500 million USD over the past three days according to data from Network Realized Profit/Loss. Money flows and pressures from investment funds Not only has the price of ETH dropped sharply, but also Ethereum-related ETF investment funds have not been able to avoid the wave of capital withdrawal. According to data from Coinglass, the net fund flows of these funds reached a negative level of 50.1 million USD on Tuesday - marking the fourth consecutive day of negative outflows. This capital withdrawal indicates that investors are concerned about the impact of economic fluctuations on the cryptocurrency market. Technical analysis and price outlook From a technical analysis perspective, Ethereum has reacted strongly to important support and resistance levels. On Tuesday, the currency touched the bottom of a declining channel and was rejected at the $2,560 level. According to experts, if ETH cannot maintain this support level and close below the declining channel, the price may continue to decline deeply, with the risk of falling below the $1,500 threshold. In this context, data from Ethereum futures contracts adds further pressure: in the past 24 hours, the liquidation volume reached approximately $116.28 million, with long orders accounting for $86.81 million and short orders for $29.47 million. Impact the entire cryptocurrency market Not only Ethereum, the entire cryptocurrency market - including Bitcoin (BTC), XRP, and Solana (SOL) - is negatively affected by the new tax announcement. Since Trump proposed to re-impose taxes on Canada and Mexico starting on Monday, the market has shown signs of losing momentum, evidence of the increasingly tight link between macroeconomic policies and the performance of digital assets. Conclusion The recent fluctuations of Ethereum are a clear evidence that macroeconomic factors, especially trade policies and tariffs, are increasingly impacting the cryptocurrency market. Investors need to closely monitor the developments of both economic policies and technical indicators to make timely trading decisions, while preparing for the possibility of further volatility in the future. In the context of globalization and the convergence of traditional economy with the digital market, it is essential to understand the impacts of policies and economic information to protect investment interests.