Bitcoin (BTC) started the new week above $70 thousand, but the $71,500 threshold was lost. Negotiations held over the weekend were not very productive. The extreme demands of the parties make compromise difficult, but the 2-week ceasefire has not ended yet and the parties have time to play all their trump cards for bargaining. So how do QCP Capital analysts interpret the current situation?
QCP Capital crypto review
Underlining that markets are ready for disappointment QCP Capital Analysts wrote that the risk aversion trend continues, which is why oil regained $ 100. BTC It encountered resistance at $74,000, while ETH fell from $2,330 to $2,180. Stalling around the $2,200 mark ETH At the time of writing, it is priced at $2,188 and volatility may increase.
“Trump has now escalated his rhetoric, threatening to impose a complete blockade of the Strait of Hormuz to cut off Iranian flows. Iran’s response has been equally sharp, hinting at a possible disruption via Bab al-Mandeb. The result has been a widening of the circle of risk; energy security has come to the fore again, while Europe is already starting to oppose.” – QCP Capital
The US blockade move is largely fueled by the motivation to disrupt the flow of oil to China. This could pave the way for Iran to be pressured by China for reconciliation, or it could pave the way for greater tensions. trump He postponed his planned visit to China at the end of March (which he had announced months ago), and a new program has not yet been formed. This visit was originally expected to take place in the middle of last year.
“China is at the center of this situation. Since Iranian crude largely flows east, any blockade would directly disrupt Beijing’s supply chain. Calls to switch to US crude are unlikely to gain support, especially where they intersect with broader strategic objectives around yuan-denominated trade.” – QCP
Risk of tension involving China
Stopping Chinese ships in international waters could cause bigger problems. Moreover, according to QCP analysts, this risk has not yet been priced in by the market. While Trump believes he can accomplish a lot in theory, the results of what he puts into practice may be beyond what he imagines.
Still, implied volatility and risk reversals say that we are in the normalization phase, despite the problems specific to cryptocurrency markets.
“Flows support this. BlackRock’s IBITled ETF demand with $612.1 million in inflows last week; “This reinforces that institutional interest is still constructive at these levels.”
The next rupture will occur when it becomes clear how the blockade is implemented and whether tensions with China will increase.
