Navigating Trump Volatility Through Strategic Bitcoin Option Plays｜Matrixport Research

Despite Treasury Secretary Bessent’s repeated assertions that the administration was indifferent to stock market performance — arguing the bottom 50%, Trump’s core constituency, owned no shares — he grew increasingly alarmed as the situation deteriorated. On Sunday, amid escalating concerns, Bessent urgently flew to meet with Trump to persuade him to address the stock market turmoil.

An unusual scenario unfolded with the U.S. stock market plunging approximately 20%: the typically safe-haven U.S. dollar was weakening, and the bond market, which usually provides a protective cushion for investors against equity declines, was simultaneously selling off.

The market remains deeply concerned about the inflationary pressures stemming from tariffs. Even Fed Chair Powell, in his recent remarks, indicated that the Fed would likely pause for now, emphasizing the need to fully understand the broader economic impacts of these tariffs — effects that remain uncertain. Despite this uncertainty, Bitcoin’s realized volatility has started to decline, which favors the selling of downside puts and upside calls as Bitcoin has been trading on a broader range.

Consequently, the ongoing tariff tensions poses considerable risk, leaving it to U.S. consumers to determine whether this situation will fade into insignificance or evolve into an era characterized by uncertainty and reduced spending.

At this stage, with any other nation, despite anticipated announcements involving Japan, South Korea, the United Kingdom, and Vietnam, Trump nonetheless declared a 90-day tariff pause targeting countries that had refrained from retaliation.

However, this decision likely reflects growing anxiety from Trump and Bessent about second-order consequences from the declining stock market, where nearly $15 trillion in market capitalization has vanished, and the potential fallout from a sustained bond sell-off.

Bitcoin remains roughly unchanged. We highlighted strong support around the $73,000 level, expecting it to hold firm. Indeed, Bitcoin’s actual low during the recent turbulent week was $74,437, aligning closely with our analysis. Although the risk/reward ratio has improved slightly at these levels, we see a significant parabolic breakout as unlikely. Consequently, we maintain that Bitcoin may remain within a broader trading range, making strategies such as selling downside puts and upside calls particularly attractive.

The $90,000 mark represents substantial resistance, coinciding closely with the crucial 21-week moving average — a historical indicator frequently determining whether Bitcoin remains bullish or bearish territory. Bitcoin continues to trade below our trend model, which remains bearish after flipping short near $96,000. However, this extended period of uncertainty plays to the advantage of option sellers.

Disclaimer: The above content is for informational purposes and reference only. The content does not constitute investment advice. Digital asset transactions can be precarious and volatile. Investment decisions should be made after carefully considering individual circumstances and consulting financial professionals. Matrixport is not responsible for any investment decisions based on the information provided in this content.

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