Bitcoin relief rally due to oil spill lasted about 36 hours.
Bitcoin fell to $69,393 on Thursday morning, down 0.8% over the past 24 hours and 4.3% on the week, after attacks on two oil tankers in Iraqi waters sent Brent crude back above $100 a barrel. barrel.
The move wiped out Wednesday’s optimism around the IEA’s proposed record reserve release and pushed back risk sentiment across Asian markets.
The chart tells the story of a market that can’t catch a break. Bitcoin touched $71,230 late Wednesday night before the tanker headlines hit, falling nearly $2,000 in a matter of hours.
It is the third time in two weeks that bitcoin has pushed above $71,000 only to be knocked back by an escalation in the Middle East conflict.
Brent rose as much as 10.5% on Thursday, driven by a combination of the tanker attacks, clearance of the Mina Al Fahal port in Oman, continued hostilities across the Persian Gulf and growing doubts about whether the IEA reserve release will be big enough to offset the supply disruption.
MSCI’s Asia Pacific index fell 1.8% with energy the only sector in the green. The session extended losses as it continued, with no sign of stabilization.
The broader crypto market followed bitcoin lower. Ether fell to $2,025, down 0.5% on the day and 4.5% on the week. Solana fell 1.5% to $85 and is now down 5.7% over seven days, the worst performing major. XRP lost 0.8% to $1.37.
Dogecoin fell 0.8% to $0.092, giving back most of Tuesday’s Musk-fueled gains. BNB was flat at $642.
The pattern in the last two weeks has been consistent. Good headlines push bitcoin towards $71,000-$74,000. Bad headlines pull it back towards $66,000-$68,000. The net movement over the period is close to zero, which is exactly what the on-chain data has suggested.
Apparent demand remains deeply negative at -30,800 BTC on a 30-day basis. CryptoQuant’s bull-bear indicator is still in bear territory, while supply in losses continues to increase. Each bounce is sold to by holders who want to exit.
Trump said earlier this week that the war would resolve “very soon” and that military objectives were “pretty well accomplished.”
But the timeline remains unclear, Iran continues to attack targets throughout the region, and the Strait of Hormuz remains disrupted. Mixed messages from Washington have left markets unable to price the duration of the conflict with any confidence.
The Fed meeting on 17-18 March is now five days away and oil back above $100 makes the stagflation case harder to dismiss and rate cuts even more distant.
