Bitcoin’s rally may be entering a critical phase as macroeconomic optimism clashes with on-chain caution.
- President Trump’s $2,000 tariff stimulus plan echoes earlier programs that preceded major Bitcoin rallies.
- Long-term holders have sold over 371,000 BTC since July, signaling profit-taking after months of gains.
- Risk-adjusted performance metrics like the Sharpe Ratio have weakened, showing lower institutional enthusiasm.
- Bitcoin trades near $104,000, holding firm above the key psychological threshold.
President Trump’s newly announced $2,000 tariff stimulus plan has rekindled debate over how government spending could once again fuel a Bitcoin surge, but data suggests the market’s internal dynamics are more complex this time.
At the time of writing, Bitcoin trades around $104,000, slipping slightly from weekend highs above $107,000. Despite the pullback, sentiment remains divided. Optimists point to the historical link between large fiscal stimulus measures and subsequent crypto rallies, while analysts warn that risk metrics and holder behavior indicate a maturing, possibly cooling phase of the cycle.
Historical Stimulus Patterns Suggest Potential Upside
Data shared by Crypto Rover highlights how previous U.S. stimulus programs often coincided with powerful Bitcoin uptrends. The $2.2 trillion CARES Act of 2020, the $900 billion Consolidated Appropriations Act, and the $1.9 trillion American Rescue Plan in 2021 all aligned with sharp increases in BTC’s market value, propelling it from under $10,000 to over $60,000 within 12 months.
Historical Bitcoin performance tends to rally following stimulus bills.
Trump just announced another $2,000 tariff stimulus plan.
You do the math. pic.twitter.com/3u2rqc8y02
— Crypto Rover (@cryptorover) November 11, 2025
The reasoning is straightforward: when governments inject liquidity into the economy, excess capital tends to spill into alternative assets, from equities to crypto. The newly proposed tariff rebate plan could have a similar psychological effect, reigniting the “stimulus trade” narrative that has historically favored Bitcoin. However, analysts caution that today’s market environment is fundamentally different — inflation remains persistent, interest rates are still high, and institutional investors are adopting a more cautious tone.
Long-Term Holders Begin Major Distribution Phase
According to Glassnode data shared by analyst Ali, long-term Bitcoin holders are entering one of their most aggressive distribution phases in recent memory. Since July, they have sold more than 371,000 BTC, indicating a shift from accumulation to profit-taking.
Long-term holders are currently at peak spending, having already sold 371,584 Bitcoin $BTC since July. pic.twitter.com/F4IcLib5lP
— Ali (@ali_charts) November 11, 2025
The Long-Term Holder Spending Indicator has reached levels associated with market tops in past cycles. When these wallets start selling heavily, it typically signals reduced conviction in near-term upside or expectations of prolonged sideways price action.
Ali noted that this wave of selling doesn’t necessarily mark the end of the bull market but could mean the market is transitioning into a consolidation zone — a phase often needed before new highs are reached.
Risk-Return Metrics Signal Growing Fatigue
Market analyst Joao Wedson added another layer to the cautious outlook, noting that Bitcoin’s annualized Sharpe Ratio and Normalized Risk Metric have both declined steadily throughout Q4. These indicators measure the balance between returns and volatility, and their downtrend suggests that Bitcoin’s recent performance hasn’t justified its risk exposure for institutional players.
The risk-return profile of Bitcoin is falling.
Both the annualized Sharpe Ratio and the Normalized Risk Metric (NRM) have been trending down. And that’s happening because, looking back at the past year, BTC’s overall performance wasn’t great — which hasn’t really encouraged a… pic.twitter.com/MUccjaDE63
— Joao Wedson (@joao_wedson) November 10, 2025
“Institutions are cautious right now,” Wedson said, pointing out that enthusiasm has waned after months of inconsistent price performance. Still, he identified a potential silver lining: when metrics like these fall, investors’ expectations tend to drop, creating the perfect conditions for the market to surprise to the upside.
Wedson believes that even if Bitcoin revisits all-time highs, the most explosive part of this cycle might already be behind us. “The more probable scenario is that next year Bitcoin needs to cool off and reset its cycle,” he concluded.
Technical Picture: Consolidation Above $100,000
Charts from TradingView show Bitcoin continuing to consolidate after multiple failed breakout attempts above $115,000. Price action over the past three months has formed a broad range between $100,000 and $120,000, with momentum fading near the upper boundary.
Still, holding above six figures for several consecutive weeks reflects strong structural support. Traders view $100,000 as the key psychological level — a break below could trigger deeper corrections, while a close above $110,000 might reignite bullish momentum heading into the final weeks of the year.
Market participants are watching upcoming catalysts closely, including Trump’s fiscal plan, November’s inflation data, and the Federal Reserve’s December meeting, all of which could influence risk sentiment across global markets.
Volatility Likely to Persist Through December
While Bitcoin’s fundamental narrative remains strong, the short-term outlook is clouded by mixed signals. Long-term holders are selling, institutional risk appetite is cooling, and macro conditions remain uncertain. At the same time, stimulus speculation and strong on-chain liquidity continue to act as potential fuel for sudden rallies.
Historically, the end of the year tends to bring heightened volatility, especially in macro-driven markets. If liquidity expands again through government spending, Bitcoin could see renewed upside pressure — but for now, traders may need to prepare for more turbulence before the next decisive move.
The information provided in this article is for educational purposes only and does not constitute financial, investment, or trading advice. Coindoo.com does not endorse or recommend any specific investment strategy or cryptocurrency. Always conduct your own research and consult with a licensed financial advisor before making any investment decisions.
Alex is an experienced financial journalist and cryptocurrency enthusiast. With over 8 years of experience covering the crypto, blockchain, and fintech industries, he is well-versed in the complex and ever-evolving world of digital assets. His insightful and thought-provoking articles provide readers with a clear picture of the latest developments and trends in the market. His approach allows him to break down complex ideas into accessible and in-depth content. Follow his publications to stay up to date with the most important trends and topics.
Source: https://coindoo.com/market/bitcoin-faces-cautious-market-ahead-of-trumps-new-stimulus-push/