The main cryptocurrency rose as much as 4% to $71,785 on Tuesday before giving up some gains to trade around $70,200 later. It began Monday after President Donald Trump suggested he was looking to end the war. Oil extended its decline on Tuesday as lawmakers reassured investors that policy interventions could reduce the impact of a war on energy prices.
The sign “gained support from global stock markets, where traders rushed to buy the dip on Trump’s comments about the imminent end of the Iranian conflict,” said Alex Koptsevich, chief market analyst at FxPro, adding that investors “entered the market driven by FOMO, fear of missing out.”Investors are also flocking back to U.S.-listed spot bitcoin exchange-traded funds after the products were seen outside late last week. The funds attracted nearly $170 million in net inflows on Monday.
Bloomberg“Conditions are stable, with momentum, ETF demand, and leverage metrics modestly improving,” blockchain data firm Glasnode reports. “However, capital flows remain soft, predictable participation is limited, and broad confidence has yet to fully recover.”
Until this month, Bitcoin has outperformed gold, the traditional inflation hedge, after lagging in recent months. While Bitcoin initially fell when the bombing began, which happened at the market close, it has risen nearly 7% this month even as the precious metal fell about 2%.
“The tip for Bitcoin has been very strong since the start of the fight, with strong support in the $68,000 area,” said Prateek Kala, head of research at Apollo Crypto. “On the upside we are looking for a strong push above $73,000 to take us to $87,000 as the next major resistance.” However, this week, Bitcoin volatility is increasing. The asset’s 30-day composite volatility index hit a two-week high. The lack of conviction in Bitcoin’s price rally has become a recurring theme in recent months.
The coin has struggled to see significant gains in short rallies since the sharp sell-off in October. That remains down more than 40% from last year’s $126,000. Traders are looking for downside protection in the options markets, with Bitcoin trading on a debt centered around the $60,000 level.
