Bitcoin is once again caught in the crosshairs of macroeconomic turbulence. The past week’s whirlwind of rising Treasury yields, mounting geopolitical tensions, and tariff war theatrics sent tremors across financial markets, pulling digital assets into the storm. According to the latest market analysis by Hyblock Capital CEO, Shubh Varma, Bitcoin’s short-term structure now faces increasing pressure, even as the broader crypto market tries to mount a recovery.

The flagship cryptocurrency, which climbed modestly to around $85,287 over the past 24 hours, is navigating a treacherous short-term setup shaped by deteriorating retail sentiment, growing open interest near critical price levels, and concerning liquidity imbalances.

Shubh Varma’s latest analysis points to emerging signs of bearish momentum, even as long-term fundamentals appear intact.

Macro Storm Clouds: Treasuries, Tariffs, and Tumbling Tech

Last week’s market turmoil was triggered by a sudden surge in Treasury yields, with the MOVE index—a volatility gauge for the U.S. bond market—spiking to levels unseen since the 2020 pandemic crash.

Yields on 10- and 30-year U.S. Treasuries soared, reflecting investor anxiety over the U.S. fiscal trajectory and inflation outlook. The spike unraveled the crowded “basis trade,” where hedge funds profit from price gaps between cash Treasuries and futures—a strategy that turns volatile when yields shift too fast.

The stress in bonds coincided with escalating trade rhetoric from former President Donald Trump, whose proposed tariffs on European and Asian imports sparked fears of a return to protectionism. Although a partial delay on tariffs, including key exemptions for Apple-linked phone components, calmed markets briefly, the episode underscored the fragility of the current risk environment.

Scott Bessent, Trump’s former economic advisor, characterized the downturn as a “Mag7 problem, not a MAGA problem,” referencing inflated valuations in mega-cap tech. The S&P 500’s price-to-earnings ratio compressed from 22x to near 17x as investors re-evaluated growth expectations.

Bitcoin in the Crossfire: Mixed Signals, High Stakes

Amid the macro turbulence, Bitcoin has shown resilience—gaining around 0.78% in the last 24 hours as per CoinMarketCap data—but Hyblock Capital’s analysis signals caution. A key metric, retail long exposure on Binance, has dropped to 47.2%, placing it in the 11th percentile.

Historically, low retail positioning suggests potential for short squeezes, but paradoxically, a rebound in this figure could trigger price downside, given Bitcoin’s inverse correlation to retail long concentration.

The report also highlights dangerous clustering in order book dynamics. Bid-ask ratios are skewed negatively at both 2% (-0.08) and 5% (-0.03) depth levels—indicators that sellers outweigh buyers across key layers of liquidity. Compounding the issue, open interest (OI) has climbed sharply, with Bybit’s OI heatmap showing significant accumulation around the $84,950–$85,200 zone. This setup creates a minefield of breakout traps and short setups, increasing the likelihood of whipsaw price action.

Downside risk is centered around $76,450–$76,750, a level that may act as a magnet for profit-taking shorts if bearish momentum persists. Meanwhile, intermediate support bands at $82,500–$82,800 and $79,800–$80,100 could offer tactical entries for contrarian long plays if sentiment turns.

Liquidation Targets and Short-Term Resistance

Upside resistance is firmly entrenched between $86,000–$87,000, where liquidation levels cluster. A move into this zone, according to Hyblock’s analysis, could prompt aggressive long unwinding or setup another shorting opportunity, particularly if open interest remains elevated and retail longs surge.

Such conditions mirror prior local tops in Bitcoin’s price action, where a burst of retail optimism and leverage culminated in sharp drawdowns. This technical environment suggests a “sell-the-rally” bias may dominate near-term trading behavior unless macro tailwinds emerge.

Market Snapshot: Cautious Optimism Amid Mixed Moves

Beyond Bitcoin, the broader crypto market is attempting to stabilize. Total crypto market capitalization has risen by 1.21% over the past 24 hours, now hovering around $2.67 trillion.

Ethereum (ETH) posted modest gains of 0.47%, trading at $1,638, while BNB declined slightly to $586.42. XRP and Cardano showed mixed action, reflecting continued sector-wide indecision.

Among major altcoins, Bitcoin Cash (BCH) led the decliners, sliding 7.70% to $326.80, followed by Ethereum Classic (ETC) and Cosmos (ATOM). In contrast, smaller-cap tokens like VeThor Token (VTHO), Alchemy Pay (ACH), and Aergo (AERGO) posted double-digit gains—suggesting pockets of speculative interest remain active.

A Broader Realignment: Is Crypto the New Safe Haven?

As global capital flows shift—exemplified by Europe selling U.S. bonds and China refusing to back down on trade—Bitcoin is increasingly being reconsidered in asset allocation discussions. The digital currency straddles a rare duality: as a risk-on asset correlated with equities, and as a hedge against fiat debasement and sovereign debt crises.

The growing adoption of stablecoins—especially those tied to U.S. Treasuries—further blurs the line between traditional finance and decentralized infrastructure. With sovereign debt sustainability under scrutiny and geopolitical tensions intensifying, these digital rails may soon become primary conduits for U.S. debt distribution—ironic, perhaps, but not unexpected.

Outlook: Short-Term Caution, Long-Term Conviction

Despite the caution lights flashing on short-term indicators, long-term conviction in Bitcoin remains intact. The path to new all-time highs by late 2025 remains viable, supported by institutional interest, favorable halving dynamics, and crypto’s growing role in the global financial system.

But traders navigating this current storm must tread carefully. With macro volatility likely to remain elevated and on-chain signals skewed bearish, patience, discipline, and risk management will be critical. Whether Bitcoin breaks higher or revisits key support, the next few weeks will offer critical insight into how digital assets respond when tested by global economic uncertainty.

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