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Bitcoin Gains as Iran War Driven Volatility Hits Oil and Stocks - BLOOMBERG
(Bloomberg) -- Bitcoin climbed past $71,000 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 $71,785 on Tuesday before later paring some of those gains to trade around $70,200. The rebound began Monday after President Donald Trump suggested that he is looking to bring the conflict to an end. Oil extended its decline 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, chief market analyst at 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 $170 million in net inflows on Monday.
“Conditions are stabilizing, with momentum, ETF 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.”
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 $68,000 region being a very strong support,” said Pratik Kala, head of research at Apollo Crypto. “To the upside we are eyeing a strong push above $73,000 to take us to $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.
