U.S.-Iran ceasefire ends, Tesla earnings: Crypto Week Ahead
TL;DR
The U.S.-Iran ceasefire is set to expire mid-week, impacting crypto markets. Bitcoin's performance hinges on maintaining its ETF cost basis around $74,000 amid fluctuating oil prices and renewed tensions in the Strait of Hormuz.
Key points
- U.S.-Iran ceasefire set to expire mid-week
- Iran fired at ships in the Strait of Hormuz
- Bitcoin's ETF cost basis is around $74,000
- Oil prices dropped after Hormuz reopening
- ETF flows have turned positive recently
Mentioned in this story
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Crypto heads into the new week with its Friday rally on shakier ground.
The announced reopening of the Strait of Hormuz sent oil lower and pushed risk assets higher, including bitcoin and the wider crypto market. The opening reversed on Saturday, with Iran firing at ships attempting to pass and the U.S. seizing an Iranian-flagged tanker on Sunday.
With the ceasefire set to expire by mid-week, traders will be watching whether the risk-on rotation can survive a renewed energy shock.
The technical level to watch is clear. Luke Nolan, senior ETH research associate at CoinShares, told CoinDesk the follow-through hinges on bitcoin holding its ETF cost basis near $74,000.
"With Hormuz reopening, oil is off and equities have caught a bid back to ATHs, pulling crypto higher with it," Nolan said. "Follow-through now hinges on BTC decisively holding above its ETF cost basis (~$74k), which would confirm the risk-on rotation already visible in flows. ETF flows have turned positive the last three sessions, and a pickup in that pace would be supportive of the move higher."
A decisive hold above $74,000 into the ceasefire deadline, paired with a fourth straight session of positive ETF inflows, would validate the rotation thesis. A break below would bring volatility back into the sector.
What to Watch
(All times ET)
- Crypto
- April 30: Comment period on the CFTC’s Advanced Notice of Proposed Rulemaking on prediction markets closes.
- Macro
- April 20, 7:30 a.m.: Canada Consumer Price Index YoY for March (Prev. 1.8%); Core Rate (Prev. 2.3%)
- April 21, 1:30 p.m.: Fed Gov. Christopher J. Waller speech on"Modernizing Reserve Bank Operations" at Brookings Institution, Washington, D.C.
- April 22, 1:00 a.m.: UK Consumer Price Inflation YoY for March (Prev. 3.0%); Core rate (Prev. 3.2%)
- April 22, 7:30 p.m.: Japan S&P Global Services PMI Flash for April (Prev. 53); Manufacturing PMI (Prev. 51.6)
- April 23, 7:30 a.m.: Canada Producer Price Index YoY for MArch (Prev. 5.4%); MoM (Prev. 0.4%)
- April 23,7:30 a.m.: U.S. Initial Jobless Claims for week ending April 18 (Prev. 207K)
- April 23, 8:45 a.m.: U.S. S&P Global Flash U.S. Manufacturing PMI for April (Prev. 52.3); Services PMI (Prev. 49.8)
Q&A
What is the significance of the U.S.-Iran ceasefire ending for the crypto market?
The end of the ceasefire could lead to renewed tensions, potentially affecting risk assets like cryptocurrencies.
How does the reopening of the Strait of Hormuz impact oil and crypto prices?
The reopening initially lowered oil prices and boosted crypto, but renewed conflict has caused volatility in both markets.
What is the technical level bitcoin needs to hold to confirm a risk-on rotation?
Bitcoin needs to maintain its ETF cost basis near $74,000 to confirm the ongoing risk-on rotation in the market.
What are the recent trends in ETF flows for cryptocurrencies?
ETF flows have turned positive over the last three sessions, indicating increased investor interest and potential support for higher crypto prices.
