Bitcoin Drops 5% Amid Middle East Tensions

Bitcoin (BTC) prices experienced a significant drop of nearly 5% over the past 48 hours, following heightened global tensions sparked by an Israeli airstrike on Iran on June 12. This geopolitical event triggered reactions in financial markets, causing Bitcoin prices to fall below $103,000 before recovering slightly to the $105,000 range.

Market analyst Ali Martinez has highlighted that Bitcoin must maintain a critical support level to avoid a substantial correction. According to Martinez, Bitcoin has been trading within a defined range since 2024, experiencing both significant price surges and extended market corrections. Over the last six months, Bitcoin has traded between $78,500 and $110,000, establishing multiple support and resistance levels within this corridor. The cryptocurrency has tested the upper boundary five times and bounced off the lower boundary four times during this period.

Given the recent crash and the potential for increased market volatility, particularly with the risk of a full-scale war in the Middle East, Martinez emphasizes the importance of Bitcoin bulls maintaining a price point above $100,000. This level represents the next major support in the market. A decisive close below $100,000 could lead to a price return to the lower boundary at $78,500, resulting in a potential 25% devaluation for current BTC holdings. Conversely, maintaining price action above $100,000 would sustain bullish momentum and increase the likelihood of a retest of the $110,000 resistance zone, with the possibility of a decisive breakout beyond the trading channel.

However, a breakdown below $100,000 would not necessarily trigger an immediate correction to $78,500. Martinez's analysis indicates that support levels at $92,000 and $86,000 could provide Bitcoin bulls with opportunities to regain market control. At the time of writing, Bitcoin is trading at $105,194, following a 1.79% decline in the past 24 hours. Despite this drop, the asset's daily trading volume has increased by 37.04%, suggesting a boost in market transactions and overall trading activity. With a market cap of $2.07 trillion, Bitcoin continues to lead the crypto market with a dominance of 62.75%.