Bitcoin’s value has fallen below $64,000 as rising tensions between the US and Iran, volatile oil prices, and a sell-off in the tech sector driven by China’s Kimi K3 launch have led investors to avoid riskier assets.
Summary
- Bitcoin’s price has decreased to under $64,000 due to geopolitical instability in the Middle East and apprehensions regarding Kimi K3.
- For a sustainable recovery toward $67,000, BTC must reclaim the $65,047 level.
- A break below $62,708 may trigger the $60,000 support level, leading to increased liquidations.
According to data from crypto.news, Bitcoin (BTC) dropped nearly 2% to $63,785 on Monday before bouncing back toward $64,000, resulting in a total decline of 1% over the last 24 hours. The Crypto Fear & Greed Index remains in the “Fear” zone at 29, while other assets like Ether, XRP, BNB, and Dogecoin have also seen slight daily losses.
Increasing risks in the Middle East aggravated following a projectile that ignited a vessel in the Strait of Hormuz, forcing the crew to abandon ship before assistance arrived. Additionally, US airstrikes reportedly resulted in one fatality in Tabriz, prompting Tehran to condemn assaults on the unfinished Darkhovin nuclear site.
CENTCOM reported that a US service member died during a controlled detonation of an unexploded Iranian drone in northern Iraq.
The initial attacks raised crude oil prices as traders assessed the risks to production and shipping in the Middle East. Brent crude briefly exceeded $85 per barrel but later retreated to around $82 after Iran’s Foreign Ministry confirmed that international mediators proposed measures to de-escalate the situation.
Tehran has also indicated a readiness to negotiate with Washington if it aligns with Iran’s national interests. This potential for diplomacy has alleviated immediate supply concerns, but ongoing attacks on vessels, Iranian cities, and nuclear sites continue to pose a risk of another spike in oil prices.
Tech stocks came under pressure following Beijing’s Moonshot AI rollout of Kimi K3, a model featuring 2.8 trillion parameters designed for coding and agent-based tasks. Internal trials suggested Kimi K3 outperformed several Western models in frontend coding; however, these claims are pending third-party validation once the model weights are released.
The launch has heightened fears that cheaper Chinese alternatives might disrupt US AI firms and their semiconductor suppliers. Bitcoin has maintained a close correlation with tech-heavy equity indices during periods of reduced risk, placing the cryptocurrency in a precarious position as investors retreat from speculative markets.
For the week ending July 15, US equity funds recorded $4.8 billion in outflows, as per LSEG Lipper data cited by Reuters. During the same period, the Philadelphia Semiconductor Index fell by 8.48%, and growth funds faced net liquidations of $7.18 billion.
Bitcoin Price Needs to Reclaim $65,000 for a Lasting Recovery
Analyzing Bitcoin’s daily chart reveals ongoing challenges around $65,047, a previous support level turned resistance. Buyers have tested this territory multiple times since early July but have repeatedly failed to achieve a daily close above it.
A decisive close above $65,047 would reestablish the recovery framework, targeting the June swing high near $67,000. Until that occurs, Bitcoin remains locked in a range between approximately $60,000 and $65,000 that has dominated trading for much of July.
On the 4-hour chart, BTC has dipped below its 20-period simple moving average at $64,206 but is still close to the 50-period average at $64,024. The 100-period SMA at $63,642 represents the next support level, followed by the 200-period SMA around $62,708.
The 4-hour relative strength has dropped to 46.56, below its moving average of 54.60, indicating that sellers have regained control of the short-term trend, although BTC has not reached oversold conditions yet.
Daily momentum presents a mixed scenario. The MACD histogram has fallen below zero to -16.55, with the MACD and signal lines converging, increasing the likelihood of a bearish crossover. Nevertheless, the Chaikin Money Flow reading remains positive at 0.13, indicating that capital hasn’t exited the market at the same rate as the price drop.
Trader Daan Crypto Trades emphasizes that Bitcoin is still attempting to close above its weekly 200-period moving average, but it needs to exhibit a stronger move to challenge the weekly 200-period exponential moving average.
“Until then, we’re just caught in this $60K choppy price range.”
Spot Bitcoin ETFs have provided limited relief following over eight weeks of substantial withdrawals, based on SoSoValue data. US-listed funds marked a second consecutive week of net inflows, with BlackRock’s IBIT contributing to a $132 million inflow on Friday, despite a $4.2 million withdrawal from Fidelity’s fund. Nevertheless, this improvement is insufficient to indicate aggressive institutional buying.
The three-day liquidation heatmap reveals significant overhead liquidity from $65,200 to $65,500. A rise into this range could force leveraged short positions to close, allowing BTC to test the daily resistance around $65,047.
Below market levels, liquidation pools lie between $63,300 and $63,600, with another cluster around $62,500 to $62,800. Price movements often gravitate toward densely leveraged zones, meaning either cluster could become a target if volatility spikes.
A Drop Below $62,700 Could Lead to Further Decline for Bitcoin
Bitcoin’s recovery potential would weaken if sellers manage a 4-hour close beneath the 100-period SMA at $63,642. A subsequent drop below the 200-period SMA at $62,708 could expose the $60,000 support level, followed by a potential decline to the late-June low near $58,000.
Analyst Ardi warns that the current bear market has yet to display the severe capitulation seen before past cycle bottoms. He argues that a prolonged range-trading phase could either exhaust sellers or that a more pronounced liquidation event must transpire to eliminate remaining leverage.
Oil prices continue to pose a significant external risk. Stalled US-Iran negotiations or renewed threats to regional energy routes could push crude prices higher again, intensifying inflation concerns and reinforcing the Federal Reserve’s higher-for-longer stance.
For bullish outlooks, a daily close above $65,047 would invalidate the current bearish sentiment and pave the way toward $67,000. Absent this breakout, Bitcoin remains vulnerable to further liquidations below $63,600.
Disclosure: This article does not constitute investment advice. The information and materials presented here are for educational purposes only.
