As soon as the news about the Iranian attacks spread, we could see a massive sell-off unfold.
Bitcoin’s price action broke through several crucial levels. First, it fell below the critical support at $63.5K. Then, it sliced through the short-term uptrend like butter. Finally, we found support at $60K, which held and led to a brief bounce.
Outlook Shifted Dramatically
With the geopolitical situation deteriorating quickly, the short-term view of BTC has changed. So far, the bullish structure built since early September is clearly broken.
From my perspective, at least a retest of the middle trendline, just below $60K, is more than likely. And we could dip lower.
It’s all about how the news plays out. Remember what happened with Russia a couple of years back? It was a similar scenario: a sharp drop, some relief, another drop, followed by a period of consolidation before the market came back stronge
Why I’m Careful With Longs
I know the temptation is there to “buy the dip” immediately. But I’m not rushing. Things look like they need more time to play out. The chance of further temporary downside is still high. The reality is that Israel is likely to respond, which could keep the tension high and pressure on the markets.
Furthermore, Bitcoin's open interest rate is still high. Accordingly, an increasing escalation can quickly lead to another (temporary) sell-off.
Long Term Bullish
To be very clear: Nothing, absolutely nothing, has changed in terms of the long-term scenario. Geopolitical tensions can indeed create massive price actions. However, typically, they are temporary and lead to a sharp price increase at a certain point.
My Plan of Action
No Active Trades Until We Find a Clear Bottom: Right now, I’m sitting on my hands when it comes to trading. The setup isn’t clear, and it’s all about protecting capital in times of uncertainty.
Slow DCA Strategy for Investing: From an investment point of view, I’m not going all in. I’ll wait a few days and slowly dollar-cost average (DCA) into some strong altcoins, gradually increasing my position as things develop.
Final Word: Be Careful, But Be Ready
Yes, it’s right to buy when there’s fear in the streets. But don’t get greedy and jump too early. Fear can get much worse before it gets better. Be prepared to act, but don’t rush it. Sometimes, patience is the best trade you can make.
