The nearly week‑long Bitcoin (BTC) recovery remains “fragile” as crypto markets contend with geopolitical and macroeconomic pressures from the Middle East conflict, said Nic Puckrin, crypto market analyst and Coin Bureau founder.
“Even if the war ends now, its repercussions will likely be the story of 2026, and certainly the dominant narrative for Q2. I don’t expect to see a rate cut until late Q3 or Q4, if at all,” Puckrin told Cointelegraph. He added: “For a push toward $90,000, we would need to see a combination of factors: a ceasefire that results in the end of geopolitical tensions, a sustained drop in oil prices toward $80, and ideally also softer‑than‑expected economic data that calms stagflation fears.”
If Bitcoin closes the week above $71,000, Puckrin said it could indicate further upside, with resistance near $74,000. At the time of reporting, BTC traded around $71,276 and remained below its 200‑day exponential moving average.
The conflict has contributed to an inflationary bump in the US Consumer Price Index, according to the Bureau of Labor Statistics report published Friday, dimming hopes for rate cuts in 2026. Lower interest rates and easier credit typically support higher asset prices.
Bitcoin rose about 5.8% starting April 6 to above $73,000 before pulling back to roughly $71,000 after reports that US‑Iran negotiations failed. The Kobeissi Letter described talks as having “come to a screeching halt,” calling the outcome close to a worst‑case scenario.
After the failed talks, US President Donald Trump said he had directed the military to form a naval blockade around the Strait of Hormuz, instructing the Navy to “seek and interdict every vessel in international waters that has paid a toll to Iran,” warning that those who pay such tolls would not have safe passage.
Federal Open Market Committee members remain split on whether to cut rates in 2026, citing war‑driven inflation risks. March FOMC minutes noted that the committee did not rule out a rate hike if inflation stayed above the 2% target. The CME FedWatch tool showed more than a 98% probability the Fed would maintain the current target range (350–375 bps) at the April 29 and June 17 meetings, with odds of a 25‑bp cut around 33.6% by the July 29 meeting.
