(March 11): Bitcoin climbed past US$71,000 ($90,325.84) as equity markets fluctuated, with traders responding to uncertainty over future oil supply amid ongoing tensions from the Iran war.
The original cryptocurrency rose as much as 4% to US$71,785 on Tuesday before later paring some of those gains to trade around US$70,200. The rebound began Monday after US President Donald Trump suggested that he is looking to bring the conflict to an end. Oil extended its decline on Tuesday as lawmakers looked to assure investors that policy interventions could cushion the war’s impact on energy prices.
The token “gained support from global stock markets, where traders hurried to buy the dip on Trump’s comments about the imminent end of the Iranian conflict”, said Alex Kuptsikevich, the chief market analyst of FxPro, adding that investors “rushed back into the market, driven by Fomo, the fear of missing out”.
Investors are also piling back into US-listed spot bitcoin exchange-traded funds after the products saw outflows late last week. The funds attracted roughly US$170 million in net inflows on Monday.
“Conditions are stabilising, with momentum, ETF (exchange-traded fund) demand, and profitability metrics improving modestly,” according to a report from the blockchain data firm Glassnode. “However, capital flows remain soft, speculative participation is limited, and broader conviction has yet to fully return.”
See also: Bitcoin jumps above US$71,000 as Iran war worries ease
So far this month, bitcoin has outperformed gold, a traditional inflation hedge, after lagging it in recent months. While bitcoin initially fell when the bombing began, which happened while markets were closed, it has risen roughly 7% this month even as the precious metal has fallen about 2%.
“The tape has been very strong for bitcoin since the war started, with the US$68,000 region being a very strong support,” said Pratik Kala, the head of research at Apollo Crypto. “To the upside we are eyeing a strong push above US$73,000 to take us to US$87,000 as the next major resistance.”
This week, however, bitcoin’s volatility has been on the rise. The asset’s 30-day implied volatility index reached a two-week high. The lack of conviction in bitcoin’s price rally has become a recurring theme in recent months.
See also: Bitcoin beats risk assets as oil surges on Iran War concerns
The coin has struggled to see significant gains in brief rallies since a sharp sell-off in October. It remains down more than 40% from its peak above US$126,000 last year. Traders continued to seek downside protection in options markets, with bitcoin puts traded on Deribit concentrated at the US$60,000 level.
Uploaded by Tham Yek Lee
