Bitcoin takes a knock from oil prices and tech sector

Bitcoin has shed around 4% of its value in just two days and is trading at $82.600 at the time of writing. The slide came after rising oil prices and a heavy sell-off in technology shares weighed on both equity and crypto markets.

The main trigger lay in the energy market. The price of Brent crude rose by roughly 4% and appeared headed for its highest closing level since mid-September. Earlier in the day the gain had reached more than 5%. Investors reacted nervously to a fresh attack on an oil tanker in the Persian Gulf, reviving fears of disruption to global oil supplies. At the same time, production in the Gulf of Mexico was curtailed by the impact of a hurricane, adding further pressure to oil prices.

Wall Street

Higher energy prices also unsettled Wall Street. US equities lost ground for a second consecutive trading day, with technology companies faring particularly badly. The Nasdaq index fell 1.4%, led by losses among chipmakers such as Nvidia and Intel. The trigger was a Financial Times report raising questions about OpenAI’s future revenue growth, which made investors nervous about valuations across the technology sector.

The crypto market did not escape the selling pressure either. Only a week ago, Bitcoin had looked poised for another upward move. Several technical signals and an improving market sentiment pointed to a possible resumption of the rally. Those optimistic expectations took a serious knock, however, from mounting geopolitical tensions and the deteriorating mood across financial markets.

Although the pullback remains modest for now compared with earlier corrections, the recent price action once again demonstrates how sensitive Bitcoin remains to macroeconomic developments and unexpected geopolitical events. What looked last week like the start of a fresh advance has for the time being been postponed by uncertainty in global markets.