Key takeaways:
- Bitcoin remains above $71,000 as weak U.S. economic data and tensions from the U.S.–Israel–Iran conflict push investors toward scarce assets.
- Meanwhile, tech stocks’ correlation with BTC and rising oil prices indicate that the five-month correction from $126,000 may not be over yet.
Bitcoin (BTC) rose above $73,000 on Friday after holding the $70,000 level as weekly support. The move came as the United States Department of Commerce reported weaker-than-expected economic activity in the U.S., heightening recession concerns, while the ongoing Iran conflict continues to weigh on global markets.
Although geopolitical tensions, economic uncertainty, and institutional inflows have supported Bitcoin’s bullish momentum, many traders remain uncertain about whether the broader bear market has truly ended.
Economic pressure boosts demand for Bitcoin
According to a report from the United States Department of Commerce, the United States economy expanded by just 0.7% between October and December 2025, a sharp downgrade from earlier estimates. With the final report expected on April 9, concerns about a potential recession in 2026 have grown, prompting some investors to move capital away from U.S. Treasuries and toward alternative assets like Bitcoin.
Yields on the U.S. 10-year Treasury climbed to 4.26%, reflecting investors’ demand for higher returns to hold these assets. The looming risk of tighter liquidity is driving traders toward scarce assets, helping to explain why the S&P 500 remains only about 5% below its all-time high despite deteriorating economic conditions.
On Monday, S&P 500 futures dropped to their lowest point in over three months following a brief spike in oil prices to $119.50. The decline eased somewhat after the United States temporarily authorized the purchase of stranded Russian oil, a measure announced by Scott Bessent on Friday, which helped calm short-term market fears.
Institutional demand is also seen as a key driver behind Bitcoin’s recent bullish momentum. Spot Bitcoin ETFs recorded four consecutive days of net inflows totaling $583 million, while analysts estimate that MicroStrategy accumulated over $900 million via its yield-bearing STRC instrument.
Bitcoin’s momentum is bullish, but the bear market persists
On the surface, rising institutional interest and liquidity support Bitcoin’s rally. However, this does not necessarily signal an end to the five-month correction following the $126,000 peak in October 2025.
Bitcoin’s 50-day correlation with the Nasdaq 100 stands at 84%, meaning market concerns over persistent inflation and sluggish economic growth increase the likelihood of a stock market pullback. Given this, traders are unlikely to use Bitcoin as a hedge, particularly as it has underperformed relative to gold.
High oil prices—currently around $30 above pre-Iran war levels—add another layer of pressure, limiting consumer spending and raising inflation, which in turn reduces the capital retail investors can allocate to crypto markets.
Spot BTC ETFs saw $2.14 billion in inflows from February 24 to March 4, driving a 14% rally, only for prices to drop 10% over the following four days as flows reversed. This indicates that ETF activity is largely reactive to Bitcoin’s price rather than a leading market indicator.
Whether Bitcoin remains above $70,000 over the weekend may have little impact on broader investor sentiment. While a five-week consolidation and multiple tests of $64,000 support demonstrate bullish confidence, recent price action has yet to produce a clear signal for a sustained breakout.
