Bitcoin Falls as Middle East Tensions Lift Oil and Dollar
Bitcoin remained below $78,000 and tested the $76,000–$77,000 support zone as hawkish Federal Reserve signals and renewed Middle East tensions triggered risk-off trading. Bitcoin was pressured by stronger US dollar demand ahead of the US Nonfarm Payrolls report, a key indicator for Federal Reserve rate expectations.
Asian stock markets fell after US strikes on Iranian rocket launchers near Larak Island in the Strait of Hormuz, followed by reported Iranian retaliation against US bases in Jordan. The Nikkei 225 dropped 2.16%, the Kospi fell 3.5%, the Hang Seng declined 0.88%, and the CSI 300 lost 0.61%. Australia’s ASX 200 gained 0.12%.
Brent crude rose above $90 a barrel, while WTI traded near $85.40 as traders priced in a higher Strait of Hormuz risk premium. Gold fell to about $4,450–$4,455, extending its sharp Friday decline, as expectations for tighter US monetary policy increased.
EUR/USD edged towards 1.1600 but remained capped by a firmer dollar. Traders are now focused on US Nonfarm Payrolls for clues about interest rates, dollar liquidity and the next move in Bitcoin. Continued geopolitical escalation or a strong jobs report could increase selling pressure on Bitcoin, while weaker employment data may support risk assets by reducing rate-hike expectations.
Bearish
The immediate market impact is bearish for crypto. Bitcoin is already below $78,000 and testing the $76,000–$77,000 support area. Three factors are working against risk assets: stronger US dollar demand, expectations of tighter Federal Reserve policy, and renewed geopolitical risk around the Strait of Hormuz.
Historically, military escalation in the Middle East has often triggered short-term selling in Bitcoin as traders reduce exposure to volatile assets and seek dollars, Treasuries or commodities. Rising oil prices can also revive inflation concerns, potentially delaying interest-rate cuts and keeping liquidity conditions restrictive. A strong US Nonfarm Payrolls report could reinforce this pressure by supporting higher yields and a firmer dollar.
However, the downside may not be permanent. A weak payrolls report, signs that the conflict will remain contained, or a reversal in dollar strength could prompt short covering and a rebound in Bitcoin. Traders should monitor the $76,000–$77,000 support zone, US Treasury yields, the dollar index, oil prices and open interest. A sustained break below support would increase the risk of deeper losses, while a recovery above $78,000 could signal improving short-term momentum. Over the longer term, geopolitical uncertainty may support Bitcoin’s alternative-asset narrative, but near-term liquidity and interest-rate expectations are likely to remain the dominant drivers.