US-Iran Tensions Turn Bitcoin Price Into a Macro Risk Barometer Again

Bitcoin price returned to the macro spotlight on Friday as US-Iran tensions influenced crypto market sentiment. BTC price continued to trade lower from a few days ago, while Ethereum was holding near to $2000 and XRP was around $1.30. 

The overall cryptocurrency market gained 0.83% to $2.48 trillion, although it failed to generate a great deal of momentum and continued to experience ETF outflows.

Bitcoin Tracks Global Risk as US-Iran Tensions Drive Market Volatility

ETF data indicates that despite the short-term crypto rally, the appetite for institutional interest is still low.

BTC price rose 0.72% over 24 hours to trade around $73,712. Despite this, recovery was still slow.

Ethereum extended its retreat to $2,000, and XRP was trading around $1.30. The short-term momentum readings were also weak for both assets.

Bitcoin’s increasing connection to macro conditions is reflected in the market’s response. The dollar, oil, rates and stocks are all in focus of investors.

US-Iran Ceasefire Hopes Ease Pressure Across Crypto Markets

The crypto rebound came after speculation that the U.S. and Iran were making progress toward a diplomatic deal.

There was a report that a tentative agreement was reached to extend the ceasefire. They could also start formal nuclear negotiations.

The US-Iran agreement would extend easefire be for a period of 60 days. It is still pending approval by President Donald Trump, however.

The market’s response to oil prices remains the primary focus. Crude prices could be quickly pushed higher should there be any disruption in the vicinity of the Strait of Hormuz.

Oil prices could start to cause inflation worries. They might also tamp down expectations for near-term interest rate cuts.

This would put pressure on Bitcoin and other risk assets. When liquidity prospects are rising, crypto tends to do well.

Persistent ETF Outflows Signal Weak Institutional Conviction

However, despite the recent crypto price rally, institutional demand has been light, as indicated by the performance of ETFs.

Spot Bitcoin ETFs’ total net outflows were $229 million on May 28 ET. This was the 9th consecutive outflow day.

ETH Total net outflows were also $121 million, with spot ETFs also experiencing similar outflows. This was their 13th consecutive day of withdrawals.

The flows are continuing and indicate defensive institutions. They have been weak to come back from the market’s pullback.

The Bitcoin derivatives market was also bearish. Open interest increased by 0.87% in the last 24 hours.

Bitcoin Price Prediction: Key Level to Watch

The MACD continues to show bearish momentum, but selling pressure seems to be easing.

The MACD line remains below the signal line, and the histogram is still negative. The RSI is currently at 36.92, a sign of weak momentum, but an improvement from oversold conditions.

Bitcoin has continued to struggle to hold onto or achieve greater upward momentum in recent days, resulting in a rejection around the $75,000 mark.

If a recovery attempt fails to make it back above $73,000, then it is another setback in the current effort. If this occurs, Bitcoin price could retest $72,000 support then head closer to $72,500.

On the upside, Long-term BTC projection must reclaim $74,000 to show early signs of renewed strength. A firm breakout above that level may lead to the $75,000 resistance zone.