Bearish view
Sell the BTC/USD pair and set a take-profit at 58,000.
Add a stop-loss at 66,000.
Timeline: 1-2 days.
Bullish view
Buy the BTC/USD pair and set a take profit at 66,000.
Add a stop-loss at 58,000.
Bitcoin price retreated for the second consecutive day, as geopolitical risks continued rising. The BTC/USD pair dropped to 62,100, a few points below this week’s high of over 64,000.
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Bitcoin’s retreat coincided with the general decline of other assets like stocks and government bonds. In South Korea, the Kospi Index dropped into a bear market, while in the US, top indices like the Dow Jones and the Nasdaq 100 continued falling. The Dow Jones dropped by over 656 points.
At the same time, the US Dollar Index (DXY) rose to $100.87, while the VIX Index rose to $17. This happened after President Trump announced that he had ended the ceasefire with Iran. As a result, the US military launched strikes against key targets in Iran for the second consecutive day. Iran, on the other hand, responded by targeting US sites in Bahrain and Kuwait.
Crude oil prices soared, with Brent crossing the crucial resistance level of $80 for the first time in weeks. There is a risk that US inflation will continue rising in the near term, pushing the Federal Reserve to hike interest rates later this year. Fed minutes released on Wednesday showed that some officials believe that the bank will hike interest rates to combat inflation.
Bitcoin is also reacting to the ongoing selling by Strategy, which is working to boost its capital base. Its goal is to sell coins worth over $1.5 billion in the next few months. It will use these funds to pay dividends and manage its debt. At the same time, after four days of inflows, Bitcoin ETFs shed assets on Thursday.
BTC/USD Technical Analysis
The daily chart shows that the BTC/USD pair has pulled back in the past few days. It dropped to 62,000 after hitting the crucial resistance that connects the highest swings since May 11.
Bitcoin has slumped below the 50-day moving average and the key support level of 67,400, its highest level on June 15. Therefore, there is a likelihood that Bitcoin’s recovery has stalled, which will see it continue falling as sellers target the key support of 58,000. A move above the resistance at 64,500 will invalidate the bullish outlook.