Was it a fake breakdown? Bitcoin rebounds as easing geopolitical tensions improve risk sentiment

<p class="MsoNormal" style="margin: 0 0 11px; line-height: 106%; font-family: Aptos, sans-serif; font-size: 15px;">FUNDAMENTAL OVERVIEW</p><p class="MsoNormal" style="margin: 0 0 11px; line-height: 106%; font-family: Aptos, sans-serif; font-size: 15px;"> </p><p class="MsoNormal" style="margin: 0 0 11px; line-height: 106%; font-family: Aptos, sans-serif; font-size: 15px;">Bitcoin rebounded yesterday and overnight after Trump said on Truth Social that the US was engaged in productive discussions with Tehran and ruled out US strikes against Iran before the midterm elections. </p><p class="MsoNormal" style="margin: 0 0 11px; line-height: 106%; font-family: Aptos, sans-serif; font-size: 15px;">The comments eased geopolitical concerns, triggering a pullback in oil prices, Treasury yields and the US dollar. This helped reverse some of the macro headwinds that had weighed on Bitcoin, while a weaker dollar provided additional support. </p><p class="MsoNormal" style="margin: 0 0 11px; line-height: 106%; font-family: Aptos, sans-serif; font-size: 15px;">The move was driven by geopolitical de-escalation and improving risk sentiment rather than a crypto-specific catalyst.</p><p class="MsoNormal" style="margin: 0 0 11px; line-height: 106%; font-family: Aptos, sans-serif; font-size: 15px;">Looking ahead, markets will focus on Iran’s response to Washington’s proposal, which Foreign Minister Araghchi said could come within the next few days, and next week’s US CPI report. </p><p class="MsoNormal" style="margin: 0 0 11px; line-height: 106%; font-family: Aptos, sans-serif; font-size: 15px;">A positive outcome could push oil prices lower, ease inflation and rate hike concerns, and support a further recovery in Bitcoin. Conversely, a negative response wouldn’t change much but it could limit the upside. </p><p class="MsoNormal" style="margin: 0 0 11px; line-height: 106%; font-family: Aptos, sans-serif; font-size: 15px;">The CPI report will be another key catalyst. Hotter than expected data could trigger a hawkish repricing of Fed rate hike expectations and weigh on Bitcoin, while a soft report would likely provide another boost for the cryptocurrency.</p><p class="MsoNormal" style="margin: 0 0 11px; line-height: 106%; font-family: Aptos, sans-serif; font-size: 15px;"> </p><p class="MsoNormal" style="margin: 0 0 11px; line-height: 106%; font-family: Aptos, sans-serif; font-size: 15px;">BITCOIN TECHNICAL ANALYSIS – DAILY TIMEFRAME</p><p></p><p>On the daily chart, we can see that <a href="https://www.tradingview.com/symbols/BITCOIN/" rel="follow" style="color: rgba(70, 120, 134, 1); text-decoration: underline;">Bitcoin</a>broke below the major upward trendline and the 82,500 support as geopolitical tensions escalated in the prior days. The price has pulled back to retest the support-turned-resistance after Trump ruled out the attacks on Iran. We can expect the sellers to step in around the 82,500 resistance, with a defined risk above the trendline, to position for a drop into the 76,000 support next. The buyers, on the other hand, will want to see the price rising back above the resistance to pile in for a rally into the 90,000 level next.</p><p class="MsoNormal" style="margin: 0 0 11px; line-height: 106%; font-family: Aptos, sans-serif; font-size: 15px;">BITCOIN TECHNICAL ANALYSIS – 4 HOUR TIMEFRAME</p><p></p><p>On the 4 hour chart, there’s not much we can add here as the sellers will look for short opportunities around the resistance and the broken trendline, while the buyers will need breakouts to start positioning for new highs. </p><p class="MsoNormal" style="margin: 0 0 11px; line-height: 106%; font-family: Aptos, sans-serif; font-size: 15px;">BITCOIN TECHNICAL ANALYSIS – 1 HOUR TIMEFRAME</p><p></p><p>On the 1 hour chart, we have a swing low around the 81,500 that could act as support in case we get a rejection from the resistance. The buyers will likely step in around the swing low, with a defined risk below it, to keep targeting new highs. The sellers, on the other hand, will look for a break lower to increase the bearish bets into the 76,000 support next. The red lines define the <a href="https://investinglive.com/Education/trading-tip-know-the-average-daily-range-adr-20220207/" rel="follow" style="color: rgba(70, 120, 134, 1); text-decoration: underline;">average daily range</a> for today.</p><p class="MsoNormal" style="margin: 0 0 11px; line-height: 106%; font-family: Aptos, sans-serif; font-size: 15px;">UPCOMING CATALYSTS</p><p class="MsoNormal" style="margin: 0 0 11px; font-family: Aptos, sans-serif; line-height: 103%; font-size: 15px;"><a href="https://investinglive.com/EconomicCalendar" rel="follow" style="color: rgba(70, 120, 134, 1); text-decoration: underline;">Today</a> we conclude the week with the University of Michigan Consumer Sentiment survey.</p> This article was written by Giuseppe Dellamotta at investinglive.com.