BTC Climbs Back to $106,000 Amid Geopolitical Volatility, but Analysts See Risk of Further Downside

Bitcoin Briefly Recovers to $106K as Tensions Escalate, but Analysts See Room for a Larger Pullback

Bitcoin clawed back some losses early Friday, bouncing to $106,000 after dipping to $102,600 on geopolitical jitters linked to renewed hostilities between Israel and Iran. However, the rebound lost steam later in the U.S. trading session as fresh reports of airstrikes hit headlines. BTC last changed hands at around $105,200, down 1.6% on the day and still hovering less than 6% below its record high.

The broader crypto market showed signs of strain. The CoinDesk 20 Index fell 4.4% over the same 24-hour period, with major layer-1 tokens like Ether (ETH), Avalanche (AVAX), and Toncoin (TON) shedding 6% to 8%. Traders cited a combination of macro headwinds and exhausted momentum following Bitcoin’s recent rally.

Crypto equities mirrored the weakness. Marathon Digital (MARA) and Riot Platforms (RIOT) dropped 5% and 4%, respectively, as mining stocks extended their retracement. However, Circle (CIRCL) bucked the trend, soaring 13% on reports that Amazon and Walmart are evaluating stablecoin use cases—a move that could bring retail-scale adoption to crypto payments and boost Circle’s market position.

Outside of crypto, traditional assets reflected a muted reaction to the Middle East conflict. Gold gained 1.3%, while the S&P 500 and Nasdaq slipped a modest 0.4% each, suggesting investors have yet to fully price in sustained geopolitical risk.

Analysts Cautious: Is Bitcoin’s Rally Losing Momentum?

Market observers remain split on whether BTC’s quick recovery is the start of another leg higher—or just a pause before a deeper slide.

“Well-absorbed bounce so far, but no strong follow-through,” noted popular trader Skew on X, adding that BTC remains closely tethered to risk sentiment in traditional markets, especially with geopolitical uncertainty elevated heading into the weekend.

Markus Thielen, head of 10x Research, flagged the drop below $106,000 as a failed breakout, advising traders not to rush back into long positions. He pinpointed the $100,000–$101,000 zone as critical support and warned that a breakdown below that range could usher in a broader consolidation phase, resembling last summer’s multi-week stagnation.

John Glover, CIO at Ledn, took a similarly measured view. He believes bitcoin has entered a corrective phase and could retreat further to the $88,000–$93,000 region before resuming its broader uptrend.

“We’re likely in a healthy reset phase,” Glover said. “And if BTC holds the low-90s, the stage could be set for a move to $130,000 later this year.”