BTC Recovery Building

Bitcoin is on watch today as the futures market continues to push higher, having now broke above the bear trend line from YTD highs. The decline in the US Dollar is fuelling a resurgence in risk appetite on Tuesday with crypto assets benefiting accordingly. BTC is now fast approaching a test of the March highs around the $76,120 level. Price has been stuck in a range since the YTD lows plumbed in early February and bulls have been calling recent price action a base, looking for a reversal higher.

Weaker USD & Better Risk Appetite

The picture has turned more bullish for Bitcoin this week. Rising hopes over US/Iran peace negotiations have been the main driver. Despite talks stumbling at the first round over the weekend, traders have been reassured by Trump refraining from launching any fresh attacks, encouraged also by news that the two sides remain in communication and negotiations will continue. If news flow remains positive and traders get any sense that a proper peace deal looks likely, this should amplify the rally in risk assets, driving BTC higher as USD safe-haven demand continues to weaken.

Less Hawkish BOJ Outlook

BTC is also being helped by less hawkish signals from the BOJ this week which is keeping the JPY carry trade intact. The unwinding of that trade previously sank BTC in August 2024 and traders have been cautious around recent BOJ hawkishness. However, with BOJ rate hike bets falling this week after dovish comments from BOJ governor Ueda, the FX backdrop remains supportive for BTC here.

Technical Views

BTC

The rally in BTC has seen the market breaking above the bear trend line from YTD highs. Price is now fast approaching a test of the corrective bull channel highs and the key $80,185 level. This is a big pivot for the market and a break of this level will be a firmly bullish signal turning focus back towards $94,450 as the next bull target. Below, $69,605 an the bull channel lows remain the key support to watch.