Despite ongoing tensions between the US and Iran in the Middle East, Bitcoin (BTC) continues to hold strong.
Bitcoin, although it fell to the $70,000 level after the first round of talks between the US and Iran over the weekend ended without a result, rose again above $74,000 following news that a second round of talks between the two countries would resume.
While it remains to be seen whether this upward trend will continue, cryptocurrency company Wintermute has shared its expectations.
Wintermute primarily reported that Bitcoin and the crypto market experienced two distinct phases last week: “In the first half of the week, the Nasdaq rose 4.5% on expectations of a ceasefire, Bitcoin increased 2.6%, and the VIX fell below 20. In the second phase, over the weekend, talks in Islamabad stalled, and the US imposed a full naval blockade on Iranian ports. This caused Brent oil to surge 8% in a single day, climbing above $103, leading to a pullback in risky assets like Bitcoin.”
On the macroeconomic front, US March CPI figures were released, showing a 3.3% increase year-on-year, while core CPI rose by 2.6%. According to Wintermute analysts, these figures were slightly below expectations, and the market interpreted them as a temporary energy shock rather than a sustained increase in inflation.
In light of this data, Wintermute analysts noted that while Bitcoin didn’t lead the rally, it closed last week up 2.6%, suggesting that the bullish trend could continue.
At this point, analysts say that ceasefire trading is dead and markets are now in climbing mode.
According to analysts, the reopening of the Strait of Hormuz could push Bitcoin above $75,000, while ongoing tensions could keep prices in a narrow range with a downward trend.
*This is not investment advice.
