Trump's executive order fails to boost BTC as Nvidia leads tech sell-off

In a week of significant market movements, President Donald Trump's executive order establishing a strategic Bitcoin reserve failed to boost cryptocurrency prices, while the tech sector faced mounting pressure with Nvidia leading a substantial sell-off.

Strategic Bitcoin reserve: not what investors expected

Bitcoin fell sharply on Friday despite what initially seemed like positive news - US President Donald Trump signing an executive order to establish a strategic Bitcoin reserve. The cryptocurrency's decline came as investors digested the fine print of the White House order, which clarified that no taxpayer money would be used to acquire digital assets.

Instead, the reserve will be funded exclusively with Bitcoin confiscated through criminal and civil forfeiture proceedings. This revelation disappointed investors who had hoped for direct government purchases of Bitcoin on the open market.

"BTC reacted to Trump's executive order to create a strategic Bitcoin reserve funded solely from assets seized by the government, raising concerns that the government wouldn't be a buyer of crypto," explained Edul Patel, CEO and co-founder of Mudrex.

While Bitcoin found support at $84,700 and rebounded to $87,600, the market's initial reaction was negative. CoinSwitch Market Desk noted, "The market reaction to this news was slightly negative as investors expected the US to deploy fresh capital into Bitcoin. However, despite calling it digital gold, the White House will not buy fresh BTC."

Tech stocks decline 

Simultaneously, the broader US stock market experienced significant turbulence, with approximately $1.15 trillion wiped from market value in a single day according to analysts. This massive sell-off has raised concerns about potential spillover effects on Bitcoin and the cryptocurrency market.

Leading the tech decline was Nvidia (NVDA), whose shares fell 5.7% on Thursday, bringing its year-to-date losses to nearly 18%. The AI chipmaking giant is experiencing its worst monthly performance since June 2022, as fears over AI demand continue to weigh on the semiconductor sector.

The sentiment shift became even more apparent after Marvell Technology's earnings report. Despite beating Wall Street expectations with non-GAAP earnings of $0.60 per share and sales of $1.82 billion, investors weren't satisfied with the growth rates. This triggered a broader sell-off across AI and semiconductor stocks.

The BTC sentiment shift is real!

The dual market movements have created a notable shift in investor sentiment. Bitcoin's Fear and Greed Index plummeted from 62 (Greed) to 34 (Fear), reflecting rapidly changing market psychology. 

Meanwhile, the tech sector is facing what Futurum Group analyst David Nicholson described as a reality check: "Wall Street is catching up to the reality that Nvidia will not create a decades-long dynasty like Intel once did. Competition is hitting them from dozens of directions."

On-chain data for Bitcoin shows declining funding rates with sellers dominating the futures market, though analysts suggest a potential bullish reversal could lead to short liquidation and drive prices higher in coming days.

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These parallel market developments highlight the interconnected nature of traditional and cryptocurrency markets. While Trump's executive order symbolically recognizes Bitcoin's importance by creating a strategic reserve, the implementation details have tempered immediate enthusiasm.

For traders  in both markets, the current environment calls for increased caution and robust risk management strategies.  As the Crypto Summit approaches, market participants will be watching closely for signals about the future direction of both Bitcoin and technology stocks.

BTC/NVDA key levels to watch

At the time of writing, BTC is hovering around $88,000. Key levels to watch are $92,733 and $96,000 on the upside. On the downside, key levels to watch are $86,075 and $84,270. Current sentiment is bearish supported by prices remaining just below the moving average. RSI sluggish at the midline also suggests waning momentum.

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For Nvidia, Key levels to watch are $136.92 on the upside and $91.56 on the downside. RSI dipping from overbought conditions hints at a further slide, though prices remaining elevated above the moving average, suggests that overall sentiment is still bullish.