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Although geopolitical tensions in the Middle East have reached a peak following the death of Supreme Leader Ayatollah Seyyed Ali Khamenei in U.S. and Israeli airstrikes on Iran, Bitcoin (BTC) has staged a strong V-shaped rebound, fueling investors’ “buy the dip” sentiment amid expectations that the shock to stock markets will be limited.
According to the securities and cryptocurrency industries on the 1st, optimism is emerging that global financial markets will quickly stabilize despite fears of all-out war erupting over the weekend. Regarding the domestic stock market, which will reopen on the 3rd after being closed on the 2nd for a substitute holiday, Mirae Asset Securities analyst Kim Seok-hwan predicted that while a short-term decline at the open is inevitable, strong buying by retail investors will flow in, showing high resilience in recovery.
Concerns about a prolonged war have also somewhat eased. Lee Kyung-soo, an analyst at Hana Securities, analyzed that the U.S. carried out the attack over the weekend to minimize financial market impact and, considering the political situation ahead of the midterm elections, the situation is unlikely to turn into a prolonged conflict. Fears that international oil prices could surpass $100 per barrel due to a potential blockade of the Strait of Hormuz—seen as the biggest flashpoint—have also subsided as reports emerged that OPEC and OPEC+, a group of major oil-producing nations, are considering large-scale production increases, calming concerns of reignited inflation.
This sense of macroeconomic relief was first reflected in the virtual asset market, which had absorbed the initial wave of selling over the weekend. Bitcoin, which had plunged to the $63,000 level immediately after the outbreak of war and suffered from panic selling, quickly reclaimed the $67,000 range on expectations that macro risks could be contained and as heavy sell orders were absorbed. With stock markets closed, displaced liquidity flowed into the 24-hour cryptocurrency market, leading a preemptive rebound rally.
Experts said that Monday’s performance of global traditional financial markets will be a key watershed for Bitcoin’s outlook. If oil prices stabilize due to production increase reviews by oil-producing countries and stock markets defend against shocks as experts expect, Bitcoin is highly likely to solidify support at the $67,000 level and strengthen its position as an alternative investment.
However, if the Middle East situation worsens unexpectedly or inflation concerns resurface, a second wave of selling across risk assets could occur. In that case, Bitcoin is expected to undergo another tough test of support around the $60,000 level, previously confirmed as a psychological Maginot line during the last sharp decline.
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