Just like bitcoin seemed to have built momentum for a break above $80,000, macro uncertainty emerged as a headwind.
The most notable development came from the Pentagon, which told US lawmakers in a classified briefing that demining the Strait of Hormuz, a major oil choke point, could take at least six months, and that the process would begin only after the US-Iran conflict ends. The report also warned that gasoline and oil prices may remain elevated through the midterm elections, according to the Washington Post.
Persistently high energy costs risk keeping inflation sticky, leaving the Federal Reserve with limited room to cut interest rates, a negative backdrop for risk assets. Bitcoin, in particular, remains highly sensitive to interest rates and global liquidity conditions rather than actual economic activity. Rising costs of essential goods such as fuel and food could also reduce investors’ willingness to allocate capital to speculative assets.
These risks are already appearing in the markets. WTI crude oil has risen to around $95 from $79 late last week, while government bond yields are rising in major economies. The US 10-year bond yield has risen eight basis points to 4.32% this week, and its UK counterpart has risen 18 basis points to 4.96%.
“Oil prices are rising along with yields and volatility spreads, indicating tighter financial conditions and higher market risks,” said Michael Kramer, founder and CEO of Mott Capital Management.
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Speaking of key indicators, US-listed spot bitcoin ETFs continue to show sustained demand, with funds recording their fastest inflows in a month based on the seven-day moving average of net flows tracked by Glassnode.
Still, some analysts urge caution, arguing that the rally lacks broad support in the spot market.
“Bitcoin’s recent price rise is entirely driven by demand in the perpetual futures market. Meanwhile, spot demand is still contracting (albeit at a slower pace). The same thing happened in January, when Bitcoin peaked at $98,000. There are risks of a correction if traders start taking profits while spot demand continues to contract,” Julio Moreno, head of research at CryptoQuant, said on X.
The market capitalization of USDT, the largest dollar-pegged stablecoin, has reached a record high of $188.88 billion. Meanwhile, speculation in non-serious tokens like is reaching a peak, with saturation of bullish bets. Stay alert!
Read more: For an analysis of current activity in altcoins and derivatives, see Crypto Markets Today. For a complete list of this week’s events, check out CoinDesk’s “Crypto Week Ahead.”
What is trend?
Today’s sign
The chart shows the fluctuations in the relationship between the price of bitcoin and gold, in candlestick format. The red line represents the 50-day moving average, the white line the 100-day moving average, and the yellow line the 200-day moving average.
The ratio has been rising steadily and has now surpassed the 100-day average. More importantly, the 50-day average could soon surpass the 100-day average, confirming a bullish crossover. As the name suggests, it suggests a bullish change in momentum.
That would mean continued outperformance of bitcoin relative to gold.
