BTC retreats from three-week peaks despite US-Iran ceasefire announcement
The cryptocurrency's push beyond $72,000 proved short-lived as market participants quickly absorbed news of a ceasefire deal between the United States and Iran.
Bitcoin (BTC) reached fresh three-week peak levels on Wednesday as Wall Street's trading session commenced, with equities rallying on news of a ceasefire agreement between the US and Iran.
Key points:
- Bitcoin briefly hits new three-week highs before round-tripping its gains.
- Iran ceasefire relief fails to last as traders demand that bulls reclaim higher levels.
- More volatility is due thanks to US inflation reports.
BTC price fails to stay above $72,000
Information sourced from TradingView showed BTC/USD touching $72,865 on the Bitstamp exchange before the day's advances began to diminish.
Announcements regarding a two-week minimum ceasefire involving the US, Israel and Iran propelled risk-on assets upward immediately, with the S&P 500 climbing more than 2.5% during the opening session.
WTI crude oil prices dropped to lows near $91 per barrel as concerns about oil supply disruptions subsided and shipping activity started to return to normal through the Strait of Hormuz. This occurred even amid reports of an assault on a Saudi oil pipeline.
"The S&P 500 is now set to open above 6,800, trading just 2.9% away from a new record high. The index has added +$1.6 TRILLION today," trading resource The Kobeissi Letter wrote in its latest market coverage on X.
Within the Bitcoin trading community, the sense of relief was equally evident.
"I mentioned earlier that a ceasefire would be a clear direction on the markets. It happened," crypto trader Michaël Van de Poppe wrote in an X response.
"Bitcoin breaks through the crucial $71K level and builds a bullish structure. Oil is down and the Strait is open, which means that there's a mean reversion play active on Bitcoin."
Van de Poppe characterized maintaining support at the $69,500 level as "crucial."
"That would strengthen the entire theory of a higher lows, higher highs and continues the momentum upwards and is likely going to fall alongside a new all-time high on the Nasdaq," he added.
More inflation volatility on the horizon
Trader Daan Crypto Trades, on the other hand, noted that the $72,000 level, which has been a resistance zone in recent weeks, required a decisive breakthrough.
"Another day another test of the $72K level. Let's see if the bulls can push through this time around," he told X followers.
"I want to see a clean break and hold above that area. Ideally for more than 1-2 days this time."
Earlier, Cointelegraph reported on other traders' concerns about overall BTC price strength, which argued that Bitcoin bulls "still have a lot of work to do."
The remainder of the week will see key US inflation releases, these set to show the initial impact of the Iran conflict and spark characteristic risk-asset volatility.