Bitcoin drops below $70,000: Iran conflict and US CPI ahead trigger risk aversion, market closely watches the $80,000 key level

On March 11, Bitcoin’s price once again fell below the $70,000 mark during Asian trading hours. Data shows that as of 01:55 Eastern Time in the U.S., Bitcoin was trading around $69,583, down approximately 0.5% for the day. The previous day, Bitcoin briefly rebounded above $70,000, but geopolitical risks and cautious sentiment ahead of macroeconomic data releases put the market under pressure again.

This volatility is closely related to the Middle East situation. U.S. President Trump recently stated that the conflict with Iran may be “basically over,” briefly boosting risk asset sentiment and pushing Bitcoin to rebound from earlier this week’s mid-$60,000s. However, Trump later warned on Truth Social that if Iran intervenes in oil supplies, the U.S. could escalate military pressure further. Meanwhile, tensions among the U.S., Israel, and Iran in the Gulf region continue.

Due to the conflict, the key global energy route, the Strait of Hormuz, was nearly shut down at one point, causing international oil prices to surge to around $120 per barrel. Although oil prices retreated after Trump’s comments, they remain high, increasing global market uncertainty.

On-chain data and market sentiment analysis platform Santiment noted that after Trump’s speech and the oil price decline, discussions about Bitcoin on social platforms like X, Reddit, and Telegram showed improved sentiment, and investor confidence temporarily rebounded.

In terms of capital flows, Bitcoin spot ETFs saw a net inflow of about $251 million on March 10. Institutional investors continue to accumulate, with major Bitcoin holders in Strategy increasing their holdings by nearly 18,000 BTC last week and making new purchases again this week. Ryan McMillin, Chief Investment Officer at Merkle Tree Capital, said Bitcoin has held above its February lows and demonstrated resilience under geopolitical pressure. He believes that if the market continues to strengthen, short positions could face squeeze near $80,000.

However, market sentiment indicators still show caution. The cryptocurrency Fear and Greed Index remains at 15, indicating “extreme fear.” Meanwhile, Google Trends data shows that the search interest for “Bitcoin” is at 71, significantly lower than the peak levels in early March.

Investors are currently awaiting the upcoming U.S. Consumer Price Index (CPI) data, which could influence market expectations for the Federal Reserve’s monetary policy path and further impact crypto market risk appetite. Additionally, the U.S. Congress’s discussion of the CLARITY Act is drawing attention, as senators attempt to reach a compromise on stablecoin yield rules, which could affect the regulatory environment for digital assets in the U.S.