Bitcoin is rising again. The cryptocurrency is gaining value in response to what the White House announced.
Bitcoin returns with a shield
Just yesterday the situation in the cryptocurrency market was far from certain. As Marek Rogalski, chief market analyst at DM BOŚ, pointed out, “BTC futures are recording a slight decline correcting yesterday’s upside.”
“In this market, as in others, the key remains what will happen with Iran – it seems we are close to the critical few dozen hours for this conflict. The chance of de‑escalation will push prices higher, allowing a quick return to the key resistance around 74 500 USD, whereas in the event of mass bombings of Iran tomorrow it is not excluded that we will quickly fall to this year’s low around 60 000 USD,” he summarized in his report from yesterday.
At night it turned out that Donald Trump announced a two‑week suspension of weapons. Israel also agreed not to attack targets in Iran during that time. Tehran also appeared willing to talk.
At the same time it was announced that the Strait of Hormuz is open again, meaning that oil tankers can pass through it. This quickly reflected in the oil price. Cheaper “black gold” means that inflationary pressure on the dollar is falling. This could allow the Fed to lower interest rates this year, which is a blessing for, among others, cryptocurrencies. And that is why the current breakout.
“The two‑week suspension of U.S. military actions against Iran triggered a sharp shake‑up in the FX market today, reversing a large portion of the movements of recent weeks. (…) The dollar index slides about 0.9%, which, with a sharp risk rebound on the exchanges, weakens demand for safe havens and pushes defensive positions in USD to the margin,” notes XTB.
But does this mean a new rally for Bitcoin? It is too early for such a forecast. For now we will probably see a reaction to the recent declines, but the key will be what happens after two weeks, when the suspension period ends.
Moreover, investors must urgently monitor what will happen in the market for BTC and ETH ETFs. Analyst Dominick John from Zeus Research considers today’s rebound a “short‑term liquidity impulse”, which, if it is to be maintained, must be reinforced by, among other things, interest rate cuts and a structural inflow of capital into ETFs.
Meanwhile, LVRG director Nick Ruck told The Block that “President Trump’s announcement of a two‑week pause in attacks on Iran eased geopolitical tensions and triggered a sharp rise in risky assets, as markets priced lower oil prices and restored global risk sentiment.”
“Ongoing obstacles, such as unresolved ceasefire implementation issues, potential re‑escalation or broader macroeconomic pressure, may continue to limit further growth if risk appetite reverses,” he added.
Also see: Bitcoin price before a big dip? This scenario “will put pressure on the decline of cryptocurrency asset values,” says the expert
Will Bitcoin’s price fight for higher levels?
Today one Bitcoin costs 71 5oo USD, which means a drop of 0,5% from yesterday, but at the same time a rise of 5% over 7 days. Over a month the cryptocurrency gained 8.5% in value.
Chart. Bitcoin price (BTC/USD)
Source: Trading Economics
How does Ether fare in this context? It currently costs about 2250 USD, which means a rise of 0,5% from yesterday and a rise of 6.7% over a week. Over a month Ethereum has risen by 16%.
Chart. Ethereum price (ETH/USD)
Source: Trading Economics
Read also: Bitcoin price waiting for a crash of about 25k USD? Expert: “Bitcoin could dive even near 45k USD.” What next for ETH?
Also see: Bitcoin price (BTC/USD, BTC/PLN) before a rally? The breakthrough is there, no hope
