Donald Trump’s tariffs and their uncertainties have led to higher odds of a recession in the US and other countries. PIMCO analysts have boosted their recession odds to 35%, and the Atlanta FedNow tool estimates that the economy will contract in Q1. So, is it safe to hold these three altcoins – Ethereum (ETH), Solana (SOL), and Binance Coin (BNB) – if the US slips into a recession?
Is it Safe to Hold These 3 Altcoins if the US Moves Into a Recession?
There is a high chance that the US will move into a recession this year because of Donald Trump’s tariffs. These tariffs will reduce consumer and business spending at a time when Trump is slashing government spending through Elon Musk’s DOGE department.
A recession is usually a good thing for risky assets as seen during the COVID-19 pandemic. That happens because the Federal Reserve usually intervenes by cutting interest rates, which boosts risky assets. Jim Cramer mentioned about this saying:
“We’re most likely not going to go into a serious recession, because the Fed can take action to prevent that. And even if the Fed does nothing, the market can recover once all of this tariff stuff is behind us — and it will be behind us at some point.”
So, will it be safe to hold Ethereum (ETH), Solana (SOL), and Binance Coin (BNB) during a recession in the US?
Ethereum (ETH)
Ethereum price has been in a strong selling spree in the past three months, moving from $4,000 to $1,800 today. Therefore, Ethereum holders are at a dilemma, wondering whether they should continue holding or sell to avoid more losses.
Technicals suggest that ETH price may have some more downside to go since the Relative Strength Index (RSI) is yet to get into the oversold level on the weekly chart. It needs to become more oversold for a rebound to happen. Also, Ethereum price has formed a triple-top pattern, pointing to further downside, meaning that it may drop to $1,500.
On the positive side, a rebound may soon happen once it gets to the oversold level and once the blood moon lunar eclipse happens this week. In most periods, panic selling often leads to strong rebounds.
Solana (SOL)
Solana price has also crashed, partly because of the ongoing slump in the top SOL meme coins. It has crashed below the lower side of the ascending channel, meaning that bears are in control. SOL price has also dropped below the 50-week moving average. Like Ethereum, the RSI has just crossed 50, and is yet to move to the oversold level, pointing to further declines.
Therefore, the token may drop to $100 as the recession odds rise and the tariff fear remain. As it has done in the past, the coin will likely bounce back, and potentially retest the year-to-date high of near $300.
Binance Coin (BNB)
BNB price has held steady during the recent crypto crash. It has dropped just from the year-to-date high of $792 to about $600 today. The coin continues to form the handle section of the cup and handle pattern that has been forming since 2021. Measuring the cup’s depth and extrapolating it from the upper side, points to a surge to $1,100 eventually.
Is it Safe to Hold These Altcoins During a Recession?
Historical data, especially during the Covid-19 pandemic shows that cryptocurrencies do well during a recession. As such, if you hold these tokens and have taken huge losses, odds are that you will do better holding them than selling now.
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