Daily Market Update: US Strikes on Iran Send Stock Futures Lower as Crypto Sells Off

TLDR

• Bitcoin fell nearly 7% on the week to around $61,233, with gold dropping below $4,200 an ounce
• The recent crypto bounce was a short squeeze, not fresh buying — over $500 million in bearish bets were liquidated
• US spot Bitcoin ETF outflows have kept institutional money on the sidelines
• US strikes on Iran pushed stock futures lower, with Nasdaq 100 futures down 0.8%
• Wednesday’s US CPI report is the key event, with a hot reading likely to push rate hike bets higher

Bitcoin and gold fell together on Wednesday as traders priced in the chance of higher interest rates. A hot inflation reading could keep the Federal Reserve hawkish, hurting assets that pay no yield.

Bitcoin traded at $61,233, down 3% on the day and nearly 7% on the week. Gold dropped 2% to below $4,200 an ounce. Both assets tend to lose appeal when rates are expected to rise.

Crypto Sells Off Across the Board

Ether fell 3.4% to $1,625. Solana dropped 4.1% to $64.24. XRP lost 4.3% to $1.12. Hyperliquid’s HYPE was the worst performer, down 10.2% on the day and 21.3% on the week to $55.52.

The recent bounce in Bitcoin was not driven by new buying. Over $500 million in short positions were liquidated, the highest since April, which briefly pushed prices up.

Spot demand has not followed. US spot Bitcoin ETF outflows have continued, keeping institutional buyers cautious.

Without broad demand to support prices, rallies have struggled to hold. If selling pressure returns after the inflation report, Bitcoin could fall further.

Stocks Fall as US Strikes Iran

US stock futures dropped after the US military confirmed “self-defense” strikes against Iran. Dow and S&P 500 futures fell around 0.3%. Nasdaq 100 futures dropped 0.4%.

The US and Iran tensions escalated after a US Apache helicopter was downed near the Strait of Hormuz on Monday. President Trump confirmed Iran was responsible and promised a response.

South Korea’s Kospi fell 6.3%, leading a 2.5% drop in the MSCI Asia-Pacific index. Brent crude traded near $92 a barrel as the Iran conflict kept oil prices elevated. The 10-year Treasury yield rose to 4.54%.

Stocks closed mixed on Tuesday as investors moved out of AI-related names. Concerns grew that the Iran conflict could push inflation higher, increasing pressure on the Federal Reserve to hike rates.

Wednesday’s May CPI report is the central event for markets. Analysts expect prices rose again. A stronger-than-expected reading would raise the odds of a rate hike later this year.

New Fed Chair Kevin Warsh has already signaled a hawkish stance. A hot inflation print could harden that position further.

Oracle is set to report earnings after Wednesday’s close. Investors will watch its cloud business, which counts OpenAI as a customer.

The SpaceX IPO is expected on Friday, which is set to be the largest public offering in history.

If gold stabilises while Bitcoin keeps falling, the case for Bitcoin as a macro hedge weakens.

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