Bitcoin fell below the $73,000 level on Thursday after renewed clashes between the United States and Iran weakened risk appetite and pushed traders toward defensive positioning.

The cryptocurrency dropped to around $72,500 before recovering slightly to trade near $73,303 at the time of writing, down 3.54% over the past 24 hours.

The decline came after military operations escalated between Washington and Tehran, threatening the fragile truce and weakening market hopes for a near-term peace agreement.

Iran’s Revolutionary Guard said it had targeted a US air base after the United States carried out strikes against Iranian drones and a launch platform near the Strait of Hormuz.

Sharp deterioration in crypto market sentiment

The decline also coincided with a clear deterioration in cryptocurrency market sentiment, as the Crypto Fear & Greed Index fell to 22, returning to the “extreme fear” zone.

Market data showed that more than 166,000 traders were liquidated over the past 24 hours, with total liquidations reaching around $932 million.

Hormuz tensions pressure high-risk assets

The conflict linked to the Strait of Hormuz remains a major concern for markets given its importance as one of the world’s key oil shipping routes.

Oil prices rose again following the latest strikes, recovering part of their previous losses tied to reports of progress in peace talks.

Brent crude climbed around 2.5% to $96.63 per barrel, while US West Texas Intermediate crude rose to around $90.93.

The rise reflects continued market pricing of risks related to disruptions in energy flows, even as prices remain below the highs recorded earlier in the conflict.

The White House also rejected Iranian media reports about a draft understanding that would involve lifting the US naval blockade in exchange for Iran restoring commercial shipping traffic through the Strait of Hormuz within one month, describing those reports as “incorrect.”

US President Donald Trump confirmed that he would not rush into an agreement, warning that Iranian attempts to prolong negotiations would not change his position.

Bitcoin loses a key support level

From a technical perspective, Bitcoin’s structure deteriorated after losing support at the $74,000 level, which has now turned into short-term resistance.

Traders are watching whether the cryptocurrency can reclaim that level to ease selling pressure.

Crypto analyst Ted said Bitcoin failed to hold above the $81,453 level before falling below $78,921 and then breaking beneath the $75,000 barrier, reflecting short-term seller dominance after the recovery attempt failed.

The first support level is currently located between $73,300 and $73,400, the range where Bitcoin is currently trading.

If buyers fail to defend that area, the next major support lies near $70,671.

A break below that level could open the way toward the demand zone between $66,318 and $65,816.

Key resistance levels

On the upside, Bitcoin needs to move back above the $75,000 level before any stronger recovery can begin.

After that, resistance appears near $78,921 and then $81,453.

Analysts believe a daily close above $81,453 could improve the short-term technical outlook and reopen the path toward the $84,000-$85,000 range.

Higher resistance levels are located near $90,235 and then $97,899, although they are not currently viewed as active targets unless Bitcoin first regains the nearer resistance zones.

Slowing network activity raises concerns

On-chain data also showed declining Bitcoin network activity, with the number of active addresses falling 39.8% over two weeks, from 821,000 addresses to just 494,000, according to data published by analyst Ali Martinez.

Declining activity during periods of price consolidation often points to weaker participation from short-term traders.

At the same time, Binance data showed spot buying volumes have been declining for months, meaning fewer traders are aggressively purchasing Bitcoin at market prices, reflecting weak spot demand during the recent recovery attempt.

Forced liquidation risks remain elevated

Funding rates on Binance have returned to positive territory, signaling that derivatives traders still lean toward long positions despite weak price momentum.

When leveraged long positioning rises alongside weak spot demand, the market becomes more vulnerable to forced liquidations.

That was clearly visible in recent trading, as the cryptocurrency market saw nearly $1 billion in liquidations over 24 hours.

Traders believe that if Bitcoin fails to reclaim the $75,000 level, attention will remain focused on the $71,000-$73,000 zone as the key area for potential rebounds.

Oil prices jumped more than 2% on Thursday after Iran’s Revolutionary Guard announced it had targeted a US air base in response to an earlier American attack in the city of Bandar Abbas.

Brent crude futures rose by $2.38, or 2.52%, to $96.67 per barrel by 08:45 GMT, while the more actively traded August contract climbed by $2.45, or 2.66%, to $94.70 per barrel. The July contract is set to expire on Friday.

US West Texas Intermediate crude also rose by $2.24, or 2.53%, to $90.92 per barrel.

Markets pull back from peace deal optimism

The two benchmark crude contracts had fallen more than 5% in the previous session to their lowest levels in a month amid hopes that the United States and Iran could reach an agreement to end the war and reopen the Strait of Hormuz.

However, hours after US President Donald Trump denied reports suggesting he was nearing a settlement agreement with Tehran, Iran’s Revolutionary Guard announced it had targeted a US air base following American strikes against an Iranian drone operation near the Strait of Hormuz, according to a US official.

John Evans, analyst at PVM Oil Associates, said the exchange of airstrikes appeared to be part of the “language of negotiation” between the two sides.

He added that prices may remain volatile as long as hopes for an agreement persist, until falling global inventories begin to have a more visible impact on the market and remind traders of the scale of oil supplies trapped behind the Strait of Hormuz bottleneck.

Tankers leave the strait with tracking systems switched off

Shipping data from LSEG and Kpler showed that two very large crude carriers and one liquefied natural gas tanker left the Strait of Hormuz this week after switching off their tracking systems and are currently heading toward India and China.

US inventories decline

In the United States, data from the American Petroleum Institute showed crude oil inventories fell by 2.8 million barrels last week, marking the sixth consecutive weekly decline.

Official inventory data from the US Energy Information Administration is scheduled for release on Thursday after being delayed by one day due to the Memorial Day holiday on Monday.

Gold prices fell in European trading on Thursday to their lowest levels in two months, deepening losses for the third consecutive session under pressure from a stronger US dollar and rising global oil prices, amid escalating military tensions between the United States and Iran in the Strait of Hormuz, threatening the collapse of peace negotiations between the two sides in Doha.

More hawkish comments from several Federal Reserve officials strengthened expectations that US interest rates could be raised at least once this year, as investors await more key economic data on growth and inflation in the United States.

Price Overview

• Gold prices today: Gold prices fell 2.0% to $4,366.68, the lowest level since March 26, from the opening level at $4,456.04, and recorded a high of $4,466.58.

• At Wednesday’s settlement, gold prices lost 1.15%, marking the second consecutive daily decline, due to the stronger US dollar amid aggressive comments from Federal Reserve officials.

US dollar

The dollar index jumped more than 0.3% on Thursday, extending gains for the third consecutive session and recording a seven-week high at 99.54 points, reflecting broad strength in the US currency against a basket of major and minor currencies.

As is well known, a stronger US dollar makes gold bullion priced in the currency less attractive to buyers holding other currencies.

The rise in the US currency comes as investors avoid risk and focus on buying the dollar as the preferred safe-haven investment due to escalating military tensions between the United States and Iran in the Strait of Hormuz, threatening the collapse of the peace negotiations in Doha.

Global oil prices

Global oil prices rose by more than 3% on Thursday after the US military carried out new strikes targeting military sites inside Iran, prompting Iran’s Revolutionary Guard to suspend the passage of oil tankers through the Strait of Hormuz.

Latest developments in the Iranian war

• The United States launched new strikes on Iran targeting a military site and missile launch platforms.

• A US official said the American military carried out strikes on an Iranian military site that posed a threat to US forces and navigation in Hormuz.

• The US official described the military operation as calculated and defensive.

• Iran’s Revolutionary Guard said it targeted a US base that served as a launch point for attacks near Bandar Abbas.

• Iranian television reported that four vessels were forced to turn back after attempting to cross the Strait of Hormuz without coordination with Iranian forces.

• Tasnim News Agency said a US tanker attempting to cross the Strait of Hormuz was forced to stop and turn back.

• Kuwait’s General Staff activated air defense systems after detecting and intercepting hostile missile and drone attacks in the region.

• The escalation of these violations could trigger a severe diplomatic crisis threatening the collapse of the ongoing negotiations in Doha.

• US President Donald Trump rejected Iranian reports claiming an agreement exists.

• Iranian media reported that the agreement would restore shipping traffic through the Strait of Hormuz.

• Trump denied the existence of any agreement regarding the Strait of Hormuz with Iran and Oman.

• Iran insists on easing economic sanctions and preserving its nuclear rights, while the two sides remain far apart.

• The US Treasury Department imposed sanctions on the Iranian authority established to manage shipping traffic through the strait.

US interest rates

• Neel Kashkari, President of the Federal Reserve Bank of Minneapolis, said fighting inflation remains the priority, as the labor market is “in a good place.”

• Austan Goolsbee, President of the Federal Reserve Bank of Chicago, said energy inflation is proving more persistent than expected.

• According to the CME Group’s FedWatch tool, markets are currently pricing in a 54% probability that the Federal Reserve will raise interest rates in December, compared to just over 16% at the beginning of May.

• Markets are currently pricing a 99% probability that US interest rates will remain unchanged at the June meeting, while the probability of a 25 basis point rate hike stands at 1%.

• Investors will later today monitor US first-quarter economic growth data, in addition to the April personal consumption expenditures report, in order to reassess those expectations.

Gold outlook

Peter Grant, vice president and senior metals strategist at Zaner Metals, said: “The Middle East remains the biggest driver. There was still some lingering optimism, but as this situation continues, that optimism is fading.”

Grant added that the ongoing conflict in the Middle East is driving global oil prices higher and increasing inflation concerns, which negatively impacts gold prices and other non-yielding assets.

SPDR Fund

Gold holdings in SPDR Gold Trust, the world’s largest gold-backed exchange-traded fund, remained virtually unchanged on Wednesday for the third consecutive session, keeping total holdings at 1,034.85 metric tons, the lowest level since May 8.

The Japanese yen declined in Asian trading on Thursday against a basket of major and minor currencies, deepening its losses for the third consecutive session against the US dollar and hitting its weakest level in four weeks, amid rising demand for the US currency as a safe haven due to escalating military tensions between the United States and Iran, raising fears that the ongoing peace negotiations in Doha could stall or collapse.

As the yen continues to weaken, it is nearing the loss of trading above the ¥160 threshold, which is considered a key level for intervention by Japanese monetary authorities to support the local currency and curb excessive movements in the foreign exchange market.

Price Overview

• Japanese yen exchange rate today: The dollar rose against the yen by 0.1% to ¥159.65, the highest level since April 29, from today’s opening level at ¥159.50, and recorded a low of ¥159.42.

• The yen ended Wednesday’s trading down 0.15% against the dollar, marking its second consecutive daily loss, following hawkish comments from several Federal Reserve officials.

US dollar

The dollar index jumped more than 0.3% on Thursday, extending gains for the third consecutive session and recording a seven-week high at 99.54 points, reflecting broad strength in the US currency against a basket of global currencies.

The rally comes amid investor risk aversion and growing demand for the US dollar as the preferred safe-haven investment, due to escalating military tensions between the United States and Iran in the Strait of Hormuz, threatening the collapse of the peace negotiations in Doha.

Global oil prices

Global oil prices rose more than 3% on Thursday after the US military carried out new strikes targeting military sites inside Iran, prompting Iran’s Revolutionary Guard to suspend the passage of oil tankers through the Strait of Hormuz.

Latest developments in the Iranian war

• The United States launched new strikes on Iran targeting a military site and missile launch platforms.

• A US official said the American military carried out strikes on an Iranian military site that posed a threat to US forces and navigation in Hormuz.

• The US official described the military operation as calculated and defensive.

• Iran’s Revolutionary Guard said it targeted a US base that served as a launch point for attacks near Bandar Abbas.

• Iranian television reported that four vessels were forced to turn back after attempting to cross the Strait of Hormuz without coordination with Iranian forces.

• Tasnim News Agency said a US tanker attempting to cross the Strait of Hormuz was forced to stop and turn back.

• Kuwait’s General Staff activated air defense systems after detecting and intercepting hostile missile and drone attacks in the region.

• The escalation of these violations could trigger a severe diplomatic crisis threatening the collapse of the ongoing negotiations in Doha.

• US President Donald Trump rejected Iranian reports claiming an agreement exists.

• Iranian media reported that the agreement would restore shipping traffic through the Strait of Hormuz.

• Trump denied the existence of any agreement regarding the Strait of Hormuz with Iran and Oman.

• Iran insists on easing economic sanctions and preserving its nuclear rights, while the two sides remain far apart.

• The US Treasury Department imposed sanctions on the Iranian authority established to manage shipping traffic through the strait.

The ¥160 threshold

Japanese authorities are closely monitoring movements in the local currency in the foreign exchange market, particularly as the yen weakens toward the critical ¥160 per dollar level, which has been viewed as a threshold that could prompt renewed market intervention.

Sources told Reuters that Tokyo intervened several times in late April and early May to halt the yen’s decline, although the currency’s recovery did not last long. At the time, the exchange rate reached ¥159.25 per US dollar, its weakest level since April 30.

Outlook for the Japanese yen

• Tony Sycamore, market analyst at IG, said previous intervention by the Bank of Japan had provided policymakers with some relief, but questions remain about its long-term effectiveness.

• Sycamore added: “The key question is whether that intervention was worthwhile for what was essentially only a temporary one-month reprieve. Moreover, will authorities have the capacity to provide similar financial support if the ¥160 level is breached again in coming sessions?”