President Donald Trump has threatened bigger import tariffs against the European Union (EU) and Canada if they worked together “to do economic harm” to the U.S.

“If the European Union works with Canada in order to do economic harm to the USA, large scale Tariffs, far larger than currently planned, will be placed on them both in order to protect the best friend that each of those two countries has ever had!” Trump said in a late Wednesday night post on Truth Social.

Financial markets, however, remain steady in the wake of the new threat, with BTC in stasis below $88,000. Germany’s DAX futures fell 0.3% while their Wall Street counterparts traded flat to positive.

The resilience in the market likely stems from Federal Reserve Chairman Jerome Powell’s recent indication that the inflationary pressures resulting from tariffs could be transitory.

Ethereum may be entering a period of heightened volatility, according to the latest outlook from decentralized options platform Derive, which sees signs of a breakout despite bearish indicators in the near term.

Nick Forster, founder of Derive, told Decrypt Ethereum’s implied volatility is currently near monthly lows, with 7-day and 30-day tenors sitting at 59% and 45%, respectively. 

“Historically, such low levels rarely hold,” he said, adding that April could mark the beginning of a sharp upswing in Ethereum volatility.

Despite the muted volatility, Ethereum’s forward rate—a measure of expected future value—is currently below the U.S. 5% treasury bill rate, signaling weak near-term confidence. 

However, Forster said that such conditions have previously preceded price spikes. 

“When forward rates are this low, we often see sharp price increases in the following weeks as leveraged positions become more attractive and demand builds,” he said.

Ethereum’s circulating supply on centralized exchanges has fallen to a nine-year low, which could amplify any price reaction if demand rises. 

Derive estimates a 30% probability Ethereum will dip below $1,800 by the end of May, but a 19% chance it will rally above $2,500.

Bitcoin remains more stable by comparison, with Derive predicting a 33% chance the asset falls below $80,000 by May and a 20% chance it breaks $100,000.

Meanwhile, other layer-1 tokens are gaining traction. XRP is seeing renewed interest following the SEC’s decision to drop its lawsuit against Ripple Labs, alongside potential ETF applications under review. Derive projects up to $8 billion in inflows if those funds are approved.

Solana is also seeing increased institutional signals, including a Fidelity-registered fund in Delaware that may evolve into a Solana spot ETF.

Ethereum experienced $86 million in outflows last week, compared to $724 million in Bitcoin inflows. 

Short-term sentiment may favour Bitcoin, but the Ethereum Foundation’s roadmap, including Etherealize and the Pectra upgrade, could shift institutional attention back to Ethereum in the second half of 2025, Forster said.

Bitcoin’s (BTC) recovery looks to have run out of steam with an emergence of a double top bearish reversal pattern on the short duration price charts.

BTC peaked near $87,400 last week, with prices pulling back to around $84,000 on Friday and staging a recovery to above $87,000 before stalling again. This sequence of two prominent peaks at roughly the same level, separated by a trough, hints at a classic double top formation. This bearish pattern often signals the end of an uptrend.

The double top pattern typically requires confirmation through a decisive drop below the “neckline,” the support level between the two peaks, which lies at around $86,000.

Should this occur, BTC could decline toward $75,000 or lower in the short term. However, long-term charts continue to indicate the asset remains in an ascending range.

Traders reacted positively to the U.S. Federal Reserve’s dovish stance on inflation and a cooldown in concerns around the upcoming U.S. tariffs, which have supported gains in the past week.

However, the lack of altcoin correlation with BTC’s recent moves hints that the current price action might lack broad market support, raising the possibility of a “fakeout” rally.

A potential drop in BTC will likely spread over to major tokens, denting recent gains and hopes of a lasting rally. Dogecoin (DOGE), heavily influenced by market sentiment and speculative trading, could see amplified losses if bitcoin’s bearish pattern plays out, while XRP might see reduced momentum, especially given its sensitivity to market sentiment and regulatory developments.

Solana could be particularly sensitive due to its recent volatility and technical indicators — with it coming close to forming a “death cross” (a bearish signal where the 50-day moving average crosses below the 200-day) in mid-April, a pattern that historically leads to deeper losses.

For now, bitcoin hovers in a critical zone. A weekly close below $84,000 could confirm the bearish double top scenario, while a push above $87,500 might invalidate it, potentially reigniting bullish momentum.