Bitcoin (BTC) may be gearing up for a powerful breakout, both technically and fundamentally, as political tensions rise in the United States. The crypto market is closely watching President Donald Trump’s public dissatisfaction with Federal Reserve Chair Jerome Powell, raising fresh questions about central bank independence and its impact on the U.S. dollar and, by extension, Bitcoin.
Trump Hints at Replacing Powell, Raising Market Jitters
In a recent statement, Trump criticized Powell’s handling of interest rates and implied he might attempt to remove him, stating:
“If I want him out, he’ll be out of there real fast, believe me.”
Although the U.S. Federal Reserve Act prohibits a sitting president from firing the Fed chair without cause, Trump’s past disregard for institutional norms has market observers on edge. According to Kevin Hassett, director of the National Economic Council, the White House is reportedly studying whether it can legally replace Powell.
This comes after Powell reiterated the Fed’s cautious approach to rate cuts, focusing instead on managing inflation concerns particularly those potentially triggered by Trump’s own tariff policies.
Impact on Bitcoin and the Dollar
Markets often interpret threats to Fed independence as a potential driver for dollar weakness. In such scenarios, safe-haven and alternative assets like Bitcoin tend to benefit. Weakening confidence in central banking institutions can shift investor focus toward decentralized currencies, amplifying demand for Bitcoin.
Historical parallels such as Turkey’s lira and Zimbabwe’s dollar show how diminished central bank autonomy can lead to currency instability conditions under which Bitcoin often thrives.
Bitcoin’s Technical Picture: A Bullish Pennant in Play
From a technical standpoint, Bitcoin is flashing a bullish signal. At last check on Saturday, Bitcoin was trading at $85,232.30, sitting just above a key resistance zone around $85,000, and approximately 14% higher than its monthly low.
The 4-hour chart shows Bitcoin forming a bullish pennant, a pattern characterized by:
- A sharp upward move (flagpole)
- A narrowing consolidation (triangle)
- A breakout potential near the triangle’s confluence
The coin is also trading slightly above the 50-period moving average, adding to bullish sentiment.
If the pattern holds, Bitcoin’s next breakout target is $88,585, its highest level in April.
Crypto Market at a Crossroads
While Trump’s ability to unilaterally remove Powell is legally dubious, even the rhetoric of intervention rattles markets and undermines confidence in fiat currencies. For Bitcoin, an asset often championed as a hedge against inflation and government overreach, this type of uncertainty only strengthens its long-term investment narrative.
Meanwhile, Ethereum and other major altcoins are also stabilizing, helping maintain the global crypto market cap at $2.69 trillion, up from $2.63 trillion a week ago.
Final Thoughts
Between technical bullish setups and growing political drama surrounding the Federal Reserve, Bitcoin finds itself at a potentially explosive moment. If President Trump escalates his criticism or attempts to interfere with Fed leadership, it could fuel demand for decentralized assets and drive Bitcoin toward a breakout.
Investors are now closely monitoring both the charts and the headlines because in today’s macro landscape, both are equally capable of moving the markets.
