Bitcoin has slipped into the mid-66,000s as oil shocks push inflation higher and expectations for rate cuts fade. The price is largely hovering around $66,000 due to the combined headwinds from Hormuz Strait-related oil rallies and rising U.S. inflation worries. March could become the first six-month decline for Bitcoin since the 2018 bear market, underscoring the macroeconomic stress weighing on the market.
The root of the recent downturn is macroeconomic stress. The potential closure of the Hormuz Strait, which handles about 25% of global seaborne oil, has driven energy prices higher, translating into immediate inflationary pressure. This shock spilled into the bond market as U.S. 10-year Treasury yields rose to post-conflict highs, and CME FedWatch shows traders pricing the possibility of emergency rate hikes. The market now faces a stagflation-like scenario with rising prices and slowing growth, complicating policy decisions.
Bitcoin confronts a dual challenge: it reacts negatively to a tighter financial environment as a risk asset, yet it has not earned broad trust as an inflation hedge. Analysts say Bitcoin is stuck in an objectively unstable environment between opposing outlooks. Technically, around the $70,000 level has become a strong resistance, while the $64,000–$65,000 range remains a key demand zone. A break below that zone could signal further downside, whereas defending it could set the stage for a rebound.
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