After a particularly turbulent two weeks in the crypto market, it seems that investors are beginning to breathe a little sigh of relief. Bitcoin is climbing above $65,800, Ethereum is returning to the $1,720 area and Solana is adding more than 4% in the last 24 hours, as the entire market records a slight recovery following the sharp collapse at the beginning of the month.
The main trigger for the gains comes from a geopolitical direction. US President Donald Trump announced that a peace agreement between the US and Iran is expected to be signed this weekend, and that following it, the Strait of Hormuz will be “open to everyone”.
This is one of the main friction points that have weighed on the markets in recent months. About a fifth of the world’s oil traffic passes through the Strait of Hormuz, and the fear of harm to the movement of goods in the area was one of the main factors for the jump in energy prices, inflationary fears and pressure on risk assets such as stocks and crypto.
The market is starting to price in a calm
According to the latest data, Bitcoin is trading around $65,820, an increase of about 2.2% in the last 24 hours. Ethereum climbs by about 2.4% to $1,719, while Solana stands out with an increase of more than 4% to a price of about $71 per coin.
The Fear & Greed Index also continues to broadcast caution. Despite the recent gains, the index stands at only 23 points – a distinct “fear” level that indicates that most investors are still skeptical about the continuation of the recovery.
The meaning is that the current rise is occurring precisely at a time when sentiment is still relatively negative, a situation that in many past cases served as a basis for more significant recoveries.
What are traders looking for now?
Many analysts point to the $65–67 thousand area as the next critical test level for Bitcoin. Only a few days ago, the currency plummeted to the $60 thousand area following an aggressive sell-off wave, outflows from ETFs and fear of further escalation in the Middle East. Now, if Bitcoin manages to break through and establish itself above the current resistance area, many of the bearish scenarios that took over the market in recent weeks could weaken significantly.
At the same time, trading data shows an interesting phenomenon. Despite the rise in price, a large portion of traders are still betting on declines. Such a situation creates potential for a Short Squeeze, a scenario in which short sellers are forced to close their positions and buy back Bitcoin, which fuels further gains.
It is still too early to declare the end of the crisis. Bitcoin is still significantly far from the record recorded last year, and markets continue to monitor developments in the Middle East, oil prices and US interest rate policy.
However, for the first time in weeks, investors are getting a tangible reason for optimism. If the peace agreement is indeed signed and leads to a full opening of the Strait of Hormuz, the pressure on energy prices may weaken, inflation fears could moderate, and risk assets, including the crypto market, may receive a significant tailwind toward the second half of the year.
Source:
www.jpost.com
