The boost to Bitcoin's price from the U.S.-Iran ceasefire is losing steam, with markets now seeking concrete signs of progress to alleviate the economic stress caused by the conflict. After briefly surpassing $76,000, the cryptocurrency's price retreated, mirroring the volatility seen earlier in the week. This follows a 10% increase primarily driven by the ceasefire announcement.
Despite ongoing optimism and President Donald Trump's suggestion that the conflict is nearing its end, negotiations to restore oil flows through the Strait of Hormuz have seen limited progress. According to QCP Capital, one of the world's largest digital asset market makers, 'A ceasefire extension alone is no longer sufficient; markets require tangible progress such as restored energy flows, reduced crude premia, and clearer disinflation.' Traders are advised to monitor oil prices closely, as signs of normalization are likely to emerge in energy markets first. The decline in Bitcoin and Ether's 30-day implied volatility indexes suggests traders expect significant progress soon. Meanwhile, Solana (SOL) and DOGE could experience increased volatility due to rising demand for leveraged exposure, as indicated by the climb in open futures contracts tied to these tokens to multi-week highs.
Alex Kuptsikevich, FxPro's chief market analyst, noted that Solana has significantly outperformed the market over the last day, attempting to bounce off a crucial long-term support line but failing to do so for over two months. 'We will only be able to declare a victory for the bulls once it has consolidated above the $105 level, at which point we can discuss a return above the 200-week moving average,' Kuptsikevich said. In traditional markets, the MOVE index, which measures volatility in U.S. Treasury notes, has declined to 65%, reversing the war-led spike to 115% in March.
This decline is bullish for risk assets, as stability in the U.S. bond market eases credit and financial conditions.
The chart of Bitcoin's hourly price action since March 31 highlights a steady upward trajectory, but with a developing double-top pattern, indicating potential exhaustion in bullish momentum. If the price dips below $73,300, the double-top pattern would be confirmed, suggesting a deeper decline to $70,000. Conversely, a sustained move above $76,000 could attract more traders and strengthen the case for a rally to $88,000.