Bitcoin experienced a brief price drop over the weekend, falling below $100,000 for the first time since early May following US airstrikes in Iran. However, it quickly recovered, trading above $101,000 by Monday morning in Asia. This leaves traders wondering if this was a minor setback or the beginning of a larger trend.
A Temporary Setback?
Arthur Hayes, co-founder of BitMEX, believes the dip is temporary. He tweeted that the weakness is short-lived and predicted Bitcoin will solidify its position as a safe haven asset. He attributes the expected price recovery to increased money printing by central banks, suggesting that these periods of increased liquidity can turn into buying opportunities for Bitcoin.
Geopolitical Events and Market Volatility
The initial price drop was linked to the US military action in Iran. The quick recovery, however, highlights how rapidly market sentiment can shift in response to major news events. While the price briefly dipped below six figures, buyers quickly stepped in, pushing the price back above $101,000.
Altcoins Feeling the Pinch
The impact wasn’t limited to Bitcoin. Most altcoins experienced a roughly 1.4% drop over 12 hours, resulting in a $50 billion decrease in the total crypto market cap. Experts anticipate a reversal of this trend once the geopolitical situation stabilizes. There’s even speculation that altcoins might outperform Bitcoin if macro risks decrease, with some smaller tokens already showing signs of strength.
Key Price Levels to Watch
Traders are closely monitoring two key price levels: the short-term realized price of around $98,000 and the trend support at $102,000. The realized price acts as a support level, representing the average breakeven point for Bitcoin holders. The $102,000 level has acted as resistance in recent weeks. As long as Bitcoin remains within the $98,000-$102,000 range, short-term rallies are possible. However, a break below $98,000 could trigger more significant selling pressure.
