 ▲ U.S.–Iran clash fears: Can Bitcoin hold the $60,000 level?/ChatGPT-generated image © |
As geopolitical shockwaves in the Middle East collide with persistent inflation fears, risk-off sentiment has swept across global markets, placing heavy downward pressure on the cryptocurrency sector, including bellwethers Bitcoin (BTC) and XRP (Ripple), and triggering panic selling.
As of Feb. 28 (local time), data from CoinMarketCap shows Bitcoin trading at $64,296.65, down 3.34% over the past 24 hours. This decline mirrors a 3.47% drop in total cryptocurrency market capitalization and highlights Bitcoin’s strong 66.78% correlation with the Dow Jones (DIA) index, underscoring that the sell-off is macro-driven and closely aligned with traditional financial markets.
The primary catalyst for the downturn was news of a joint U.S.–Israel airstrike on Iran on Feb. 28, 2026. With concerns mounting over a potential escalation into the worst Middle East conflict in decades, risk aversion has intensified across global asset markets. Adding to the pressure, the U.S. January core Producer Price Index (PPI) rose 3.6% year-over-year, far exceeding the 3.0% market forecast, dampening expectations for near-term rate cuts by the Federal Reserve. As a result, Bitcoin was treated not as a safe-haven asset but as a high-risk asset amid the geopolitical crisis.
Cascading liquidations in the derivatives market further exacerbated the decline. Over the past 24 hours, more than $169 million worth of Bitcoin positions were forcibly liquidated, with the bulk of losses concentrated in long positions. The perpetual futures funding rate plunged to minus 6%, marking its lowest level in three months and signaling extreme bearish sentiment and a buildup of short positions. However, if prices stabilize and rebound, the negative funding rate could provide the groundwork for a potential short squeeze driven by forced short covering.
From a technical perspective, Bitcoin is precariously testing support around $63,100, its recent short-term low. The 50-day simple moving average (SMA) at $65,750 and the 38.2% Fibonacci retracement level at $66,193 are acting as significant overhead resistance. Unless Bitcoin convincingly breaks above the $66,900 resistance zone, the broader bearish trend is expected to persist.
Although institutional inflows into spot exchange-traded funds (ETFs) have helped solidify the market’s foundation, they have thus far been insufficient to counter the impact of macroeconomic fear and leveraged liquidations. Over the next two days, the key question is whether Bitcoin can defend the $63,100 support level and stage a relief rally toward $66,900, or whether escalating negative factors will drag it down to the psychological threshold of $60,000.
Disclaimer: This article is for informational purposes only and should not be construed as investment advice. The publisher assumes no responsibility for any investment losses incurred based on this content.