Bitcoin Price Forecast as Polymarket Odds of Crude Oil Hitting $130 Jumps

Key Insights

• Bitcoin price may drop sharply as traders predict that crude oil prices will hit $130.
• Odds that crude oil will jump to $130 soared to 51% on Polymarket.
• The coin has formed a bearish flag pattern, pointing to more downside.

Bitcoin price has dropped sharply from its all-time high, and the situation may get worse as global risks continue rising such that Polymarket traders bet that crude oil will surge to $130 this month. BTC coin was trading at $66,900 on Sunday, down sharply from the record high of $126,300.

Polymarket Traders are Betting Crude Oil Price Will Hit $130

Geopolitical tensions are rising, pushing many traders on Polymarket to bet that crude oil prices will rise from the current $110 to $130 and above in the near term.

A Polymarket poll places odds that the West Texas Intermediate (WTI) will jump to $130 this month at 51%. Odds that it will jump to $120 has jumped to 80%. A move from the current level to $130 would mean a nearly 20% increase. Oil has already jumped by over 104% from its January low this year.

The soaring crude oil price has pushed other oil derivatives higher. Jet fuel price has jumped by over 104% in the last 30 days, while the average gasoline price in the US has soared to $4. Diesel prices have also continued the rally.

In a Truth Social post on Saturday, Donald Trump reminded Iran that it had 48 hours to reach a deal with the United States and open the Strait of Hormuz or face substantial attacks on critical infrastructure.

In another statement on Sunday, he reiterated that Tuesday will be “power plants and bridges days.” His statements are meant to put more pressure on Iran to reach a nuclear deal and have the strait open, which will lower crude oil prices.

Iran has warned that it will not cave to the United States and reiterated that it will defend itself. Most importantly, it has warned that it will destroy critical infrastructure projects in the Middle East and Israel. Its targets will be bridges, power plants, and desalination plants in the region.

Higher Oil Prices are Bearish for BTC Prices

Soaring crude oil prices and geopolitical tensions are bearish for Bitcoin in several ways. First, Bitcoin has proven that it is not a safe-haven asset, meaning that investors will likely sell it as the crisis escalates.

Second, higher oil prices will lead to strong consumer and producer inflation in the US. As a result, Trump will not achieve his goal of having interest rate cuts this year.

Indeed, a Polymarket poll shows that most traders don’t expect any cut this year. Also, short-term government bond yields have continued rising in the past few months, a sign that investors don’t expect the Fed to ease.

Third, soaring crude oil prices tends to push investors away from risky assets into value names such as energy stocks.

Still, on the positive side, there is a chance that TACO will occur, especially if the president sees crude oil prices rising and stocks plummeting. TACO stands for Trump Always Chickens Out, where he comes up with something to calm down the markets. For example, he gave Iran 10 more days to reach a deal after the stock market plunged.

Bitcoin Price Technical Analysis

The weekly chart sends a signal that Bitcoin price is preparing a strong bearish breakdown. It has already dropped below the 200-week moving average, which has provided it with substantial support since April 2023.

Bitcoin has formed a large bearish flag pattern and is now approaching the lower boundary of the channel, a sign that a bearish breakdown is imminent. It has dropped below the 50% Fibonacci Retracement level at $70,900.

Bitcoin has remained below the Supertrend indicator since October last year. Therefore, it is just a matter of time before the coin drops sharply, potentially to the important support level at $60,000. If this happens, it will raise the possibility that the coin will drop to the key support level at $50,000.

The post Bitcoin Price Forecast as Polymarket Odds of Crude Oil Hitting $130 Jumps appeared first on The Market Periodical.