Bitcoin shows resilience against rising oil prices and geopolitical tensions in the Middle East. A recent price surge has rekindled investor interest, underlining confidence in Bitcoin's continued growth.
Bitcoin Recovers After Testing Support Level
Bitcoin reclaimed $108,000 on Monday after retesting the $104,000 support level over the weekend. This change occurred amid worsening conditions in the Middle East and diminished expectations for interest rate cuts in the United States, signaling stronger confidence in Bitcoin’s growth potential.
Markets Remain Steady Despite Geopolitical Risks
Traders' sentiment remained steady despite worsening socio-economic conditions, as evidenced by Bitcoin's derivatives metrics. The Bitcoin futures premium reached 5% on Monday, indicating a neutral market. While this level is below the 8% recorded in late May, there was little response during the $101,000 retest on June 5, demonstrating market resilience.
Potential Hurdles to Bitcoin's Growth
Despite the uptrend, Bitcoin's path to reclaiming $110,000 may encounter challenges due to rising energy prices and uncertainty regarding the Federal Reserve's interest rate cuts. Rising inflationary pressures have caused traders to price in a 63% chance that the Fed will keep rates at 4% or higher by November. Trader confidence was also reflected in the Bitcoin options market, where the delta skew (put-call) dropped to a neutral 1% on Monday.
Overall, Bitcoin continues to display confidence amid global economic and geopolitical turmoil, though some analysts caution about potential obstacles related to rising energy costs and uncertainty in Federal Reserve policy.
