Cryptocurrencies are declining with BTC falling to $68k on Monday amid weak sentiment in global equity markets, a stronger U.S. dollar, and a surge in U.S. Treasury yields. Investors’ attention is shifting toward energy markets and the crisis in the Strait of Hormuz. At the same time, higher BTC mining costs may translate into increased selling pressure from so-called miners.
- Rising inflation risks are pushing yields higher and, in the short term, triggering market “hedging” mechanisms against a potential return to hawkish central bank policies—risk assets are losing ground.
- Oil is trading بالقرب $110 per barrel, and according to a statement from Donald Trump, Iran has around 14 hours to “fully reopen the Strait of Hormuz”—otherwise, the country’s critical infrastructure may be targeted.
- Tehran has so far clearly opposed this and has threatened retaliatory strikes on critical infrastructure across the region, including water supply systems—key for the surrounding Arab world.
- According to sources including the Jerusalem Post, a ground operation in Iran appears necessary and could initially target nuclear facilities in Isfahan and Natanz, as well as Khark Island—crucial for Iran’s oil exports.
Bitcoin correlation with the S&P 500 at multi-year lows
The correlation between BTC and the S&P 500 has fallen to its lowest level since 2020. Importantly, however, Bitcoin began declining well before the stock market correction started. In such a scenario, without BTC returning to an upward trajectory, rebounds in equity indices may be more likely to serve as profit-taking opportunities rather than signaling a trend reversal.
Source: CryptoQuant
Bitcoin approaching accumulation levels?
On-chain BTC valuation indicates that prices are getting closer to “attractive” levels seen during previous bear markets in 2020 and 2022. On the other hand, the current crisis driven by rising oil prices represents a new factor for BTC, and it remains uncertain how markets will react in the medium term or whether the situation will be resolved quickly. It appears that declines could slow around $45,000 if another wave of selling occurs.
Source: CryptoQuant, TradingView
Bitcoin and Ethereum charts (D1)
Bitcoin has pulled back 10% from its local high and is trading again around $68,000—midway between $60,000 (local low) and $75,000 (local high). If the pattern from the 2022 bear market were to repeat, we could see another strong and possibly final downward impulse, pushing prices toward approximately $45,000.
Source: xStation5
In the case of Ethereum, the latest (third) impulse could lead to a sell-off toward around $1,200. This would mean a retest of the 2022 lows. A breakout above the EMA200 (around $2,900) could reverse the trend to bullish.
Source: xStation5
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