Bitcoin Nears $107K Amid Geopolitical Relief and Fed Uncertainty

Bitcoin surged to near $107,000 on Wednesday, gaining 1.7% over the past 24 hours, as a U.S.-brokered ceasefire between Iran and Israel eased immediate fears of an oil supply disruption, propelling risk assets higher. The broader crypto market, represented by the CoinDesk 20 index, added 1%, with Bitcoin trading at $106,693.69 as of the latest data, hitting a 24-hour high of $107,830.26 and a low of $106,304.78. However, Susannah Streeter, head of money markets at Hargreaves Lansdown, highlighted growing doubts about the truce holding, pointing to a leaked U.S. intelligence report that questioned the effectiveness of strikes on Iran's nuclear capabilities, which could reignite market volatility. This rally underscores how geopolitical events swiftly influence crypto prices, with Bitcoin's dominance rising to 65.52%, reflecting its role as a barometer for broader risk sentiment.

Fed Policy and Economic Data Drive Market Sentiment

Federal Reserve Chair Jerome Powell's testimony before House lawmakers on Tuesday emphasized a "wait-and-see" approach to interest-rate cuts, citing elevated inflation and potential tariff pressures. According to Bitunix analysts, this stance introduces short-term uncertainty but supports risk assets by maintaining flexibility. U.S. consumer-confidence data softened, pulling two-year Treasury yields to a six-week low of 3.78% on Wednesday and raising the perceived chance of a July rate cut to about 20%, up from 13% a week ago, based on the CME FedWatch tool. Powell is scheduled to testify before the Senate Banking Committee later today, with traders eyeing any hints of policy shifts amid President Trump's calls for lower rates. Concurrently, key economic releases on June 26 include durable goods orders (estimated at 8.5% MoM vs. previous -6.3%) and final Q1 GDP data (estimated at -0.2% QoQ), which could sway crypto markets through rate expectations and dollar strength, as DXY edged up 0.28% to 98.14.

Crypto derivatives activity reveals cautious optimism, with neutral positioning around the June 27 options expiry. Jake O, an OTC trader at Wintermute, noted traders sold straddles and short puts near $105,000 and $100,000, indicating expectations of tight price action in Bitcoin. Yet, call option buying targeting $108,000 and $112,000 for July and September expiries points to a modest bullish tilt. The annualized three-month BTC futures basis on offshore exchanges advanced slightly to 5%, though it remains below May highs above 7%, while perpetual funding rates on Binance stand at 0.0048% (5.2626% annualized), signaling moderate bullishness. Spot BTC ETFs recorded daily net inflows of $588.6 million, accumulating $47.58 billion in total holdings, and ETH ETFs saw $71.3 million in inflows, according to Farside Investors, highlighting sustained institutional interest.

Trading Opportunities and Key Levels to Monitor

Technical analysis offers actionable insights, with the Binance-listed XRP/BTC pair trading in a falling wedge pattern, characterized by converging trendlines of lower highs and lower lows. This setup suggests weakening bearish momentum and a potential bullish reversal if a breakout occurs, providing a strategic entry point for traders. Support levels for Bitcoin are firm around $105,000 and $100,000, with resistance at $108,000 and $112,000. A sustained break above $107,000 could trigger further gains, while downside risks include geopolitical flare-ups or adverse inflation data. Upcoming events like the Core (CORE) hard fork on June 25, ZIGChain mainnet launch, and CME's introduction of spot-quoted futures on June 30 may catalyze volatility, especially for AI-related tokens and broader market liquidity. Additionally, token unlocks such as Optimism (OP) releasing $17.13 million worth on June 30 could pressure prices if not absorbed by demand. Traders should leverage this data, monitoring Powell's Senate testimony and economic indicators for tactical entries, as Bitcoin's correlation with equities remains high, with the S&P 500 closing up 1.11% on Tuesday at 6,092.18.