Bitcoin Approaches $62K as Market Faces Multiple Headwinds
Bitcoin declined further on Tuesday, approaching the $62,000 level, extending its weak consolidation pattern. Ethereum also weakened, falling below $1,700. Over the past 30 days, both Bitcoin and Ethereum have retraced nearly 20%. The main pressures behind this decline include a sixth consecutive week of spot ETF outflows, a hawkish shift in Fed rate expectations, and quarter-end options expiry.
Fed Turns Hawkish; Dot Plot Suggests Rate Hikes
The first source of market pressure this week came from the Federal Reserve. At the June 18 FOMC meeting, the Fed held rates at 3.5%–3.75% but notably removed dovish language from its statement. The dot plot shifted from implying rate cuts to implying rate hikes. Nine of the 18 officials now expect at least one rate hike this year, and the probability of a December rate hike has risen significantly compared to a month ago.
Geopolitical Risks Resurface as Iran Walks Away
The second pressure point is geopolitical risk. Earlier, expectations of a US-Iran ceasefire had pushed Bitcoin above $67,000. However, during the signing ceremony on June 19, the situation broke down and Iran withdrew from negotiations. Because crypto markets trade 24/7, Bitcoin was the first asset to reflect this negative shock.
Options Expiry and Cautious Sentiment
Additionally, Deribit is set to see approximately $10.6 billion in options expire on June 26, adding to the cautious mood at the end of the quarter. Analysts believe that leverage has been largely cleared and market positions are defensive, but the next direction will depend on Thursday's PCE inflation data and whether spot ETF inflows can turn positive again.