Bitcoin bounced on Friday morning, possibly on the news of a tit for tat strike by Israel on Iran. The strike could have been Israel’s way of saving face without escalating the conflict. As markets recognise this, will bitcoin continue to rally?
Quandary for Netanyahu
Israel’s prime minister Benjamin Natanyahu was facing quite a quandary. His country’s attack on the Iranian embassy in Syria was perhaps a calculated one that had the goal of dragging the US into the fight with Iran. However, it looks as though this did not have the anticipated result, as the Americans are probably just not ready for conflict on yet another front.
Iran’s combined drone and missile strike on Israel appeared to strategically have been a far better option. The attack was aimed at military bases, was telegraphed so that the Israelis would be ready for it, killed no civilians or even army personnel, and was able to breach the Israeli defences despite air support for the Israelis from other countries.
Israel needed to react in order to save face, but it appears that the Israeli military understood that massive retribution would only escalate the conflict, and that they might be facing Iran without the support of the US.
Therefore, Friday’s drone and possibly missile attack, on the city of Isfahan, and an unconfirmed attack on Tabriz, may have been the face-saving attacks that end the sequence of tit for tat strikes between Israel and Iran, and it might be that the market is recognising this.
Bitcoin rallies
Of course, nobody can predict what either Israel, Iran, or even any of the other involved countries might do which could escalate the crisis once more, but the crypto market, which is possibly the canary in the coal mine for traditional markets, is currently experiencing some kind of rally.
Source: Coingecko/Trading View
In the very short hourly time frame it can be seen that $BTC bounced strongly from the price level of $59,600, which was probably the last line in the sand. Currently the price is trying to flip the $64,500 resistance into support, with the next resistance at $66,800 a possible target.
Bull flag pattern holds
Source: Coingecko/TradingView
The above 4-hour chart shows how $BTC bounced beautifully from the bottom of what looks to be a bull flag. A break of the resistance at around $64,500 would likely see the $BTC price head back towards the top of the bull flag, and a confirmed break of the pattern to the upside would mean the bull market could resume.
Bitcoin can weather the storm
There is much that can still happen, both from a conflict or economic perspective, that can further derail bitcoin. However, that said, it may be argued that if either of these two bad scenarios do take place, bitcoin might be the best placed asset to weather that particular storm.
Disclaimer: This article is provided for informational purposes only. It is not offered or intended to be used as legal, tax, investment, financial, or other advice.
