Bitcoin retreats from $80K amid US-Iran uncertainty, negative BTC ETF flows, and ahead of the Fed

Bitcoin is falling for a second straight day on Tuesday as institutional demand weakens and uncertainty around US–Iran relations weighs on sentiment. 

The largest cryptocurrency has now faced rejection twice at the $80K resistance zone in recent weeks, signalling fading momentum. US equities are also set to open lower, reflecting a broader weakening in risk appetite. 

Stalled peace talks and oil at $110 

Stalled peace talks between Washington and Tehran continue to cloud the outlook for the Middle East conflict. With the Strait of Hormuz still closed, Brent crude has climbed to around $110 per barrel, raising concerns over renewed inflation pressures and pushing Treasury yields higher ahead of the Federal Reserve’s rate decision tomorrow. 

Higher oil prices lift inflation expectations, which in turn support higher yields and tighter financial conditions — an environment that typically weighs on risk assets, including crypto. 

Fed in focus as policy outlook tightens 

The Federal Reserve is widely expected to leave interest rates unchanged at 3.5%–3.75% at its upcoming meeting. This is 100% priced in, so attention will be on Federal Reserve Chair Jerome Powell’s guidance. 

Inflation risks rising due to higher oil prices. However, growth and labour market risks remain in play, meaning the Fed faces a difficult balancing act. Powell is likely to emphasize a “wait-and-see” approach, reinforcing expectations that rates will remain higher for longer. The market is pricing in a 35% chance of a rate cut this year, down from multiple cuts expected prior to the start of the war. 

A slight hawkish lean from the Fed would be a negative backdrop for Bitcoin and equities, given the impact of tighter liquidity conditions. 

ETF outflows add to cautious tone 

Institutional flows have also reversed. US spot Bitcoin ETFs recorded $263.2 million in net outflows on Monday, snapping a nine-day streak of inflows. This shift is significant, as it comes just ahead of a macro-heavy week. The loss of ETF momentum is also noteworthy, as these flows have been key in supporting Bitcoin’s rally throughout April. 

Markets now face a busy calendar of macro catalysts. In addition to the Fed decision, investors will be watching US inflation data, GDP figures, and central bank updates from Europe and Asia. These releases could reinforce stagflationary concerns driven by higher energy prices and slowing growth. 

Key level: $80K remains the barrier 

Despite the recent pullback, Bitcoin has still shown resilience, rising around 13% over April. However, multiple crosscurrents — geopolitical uncertainty, rising yields, and fading institutional flows — are complicating the outlook and limiting the potential for a sustained rally.  

A sustained break above 80k would signal renewed momentum and open the door to further gains. Until then, Bitcoin is likely to remain range-bound, with risks skewed towards consolidation. 

Bitcoin technical analysis