Crypto Market Awaits Ceasefire Deadline and Tesla Earnings

The crypto market enters the new week on uncertain ground after a rally on Friday. The initial announcement to reopen the Strait of Hormuz led to a decrease in oil prices and an increase in risk assets, including bitcoin and the broader crypto market. However, this development was short-lived, as Iran targeted ships attempting to pass through the strait on Saturday, and the U.S. seized an Iranian tanker on Sunday. As the ceasefire is set to expire mid-week, market participants will be closely watching whether the current risk-on sentiment can withstand a potential energy crisis. From a technical standpoint, the key level to monitor is bitcoin's ability to hold its ETF cost basis near $74,000. According to Luke Nolan, a senior research associate at CoinShares, the sustainability of the recent rally hinges on bitcoin's performance relative to this threshold. Nolan noted, 'The reopening of the Hormuz Strait led to a decline in oil prices and a rebound in equities to all-time highs, which in turn pulled the crypto market higher. The next step depends on whether BTC can decisively hold above its ETF cost basis, approximately $74,000, thereby confirming the risk-on rotation evident in fund flows.' A decisive hold above $74,000, coupled with a fourth consecutive day of positive ETF inflows as the ceasefire deadline approaches, would lend credibility to the rotation narrative. Conversely, a break below this level would likely introduce increased volatility into the sector.