Analyst: "Bitcoin Could Fall to $56,550 Due to Iran Situation"

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Bitcoin (BTC) has fallen sharply after failing to recover to $64,000, raising concerns about further declines. Cryptocurrency analyst Ali Martinez warned that in a worst-case scenario, Bitcoin could drop to $56,550 if rising Middle East tensions combine with technical bearishness.

According to crypto media outlet Finbold on July 8 (local time), Bitcoin sharply reversed after recovering to $64,000 between July 7 and 8, falling to around $62,000. Ali Martinez analyzed via X that since Bitcoin faced resistance at the upper end of the $63,600 channel, it is likely to first fall to $59,700, and the lower end of the channel, $56,550, could be the final downside target.

The outlet cited the worsening situation in the Middle East as the direct trigger for this decline. On July 7, Iran fired at a civilian vessel attempting to pass through a southern shipping lane off the coast of Oman, prompting the U.S. to launch retaliatory airstrikes. Subsequently, U.S. President Donald Trump's statement on July 8 that the ceasefire had ended further exacerbated market instability. As a result, not only cryptocurrencies but also stock markets showed weakness, and international oil prices surged, ending several days of decline.

However, the outlet analyzed that the recent Bitcoin weakness cannot be explained by geopolitical variables alone. Bitcoin had already rebounded to around $64,500 on July 6 before turning downwards, and the next day, it formed a lower high near $64,000 and lost upward momentum.

The long-term downtrend was attributed to sluggish institutional investor demand and limited inflows into Bitcoin spot ETFs. While ETF funds maintain net inflows, their scale is not large enough to change the market direction. Furthermore, Michael Saylor, known as a prominent Bitcoin bull for MicroStrategy, selling over $200 million worth of Bitcoin earlier this week was also cited as a factor worsening investor sentiment.

Ultimately, the outlet analyzed that if Bitcoin fails to recover the $63,600 resistance in the short term, it needs to keep open the possibility of further declines to $59,700 and then to $56,550. Geopolitical uncertainty and institutional fund flows were identified as key variables that will determine Bitcoin's direction for the time being.

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