Bitcoin continues to hold firmly above the $70,000 threshold, extending its recent gains as global risk assets rallied across equities, commodities, and digital currencies.
Bitcoin marked a near 10% recovery after a jagged week of geopolitical panic. Stocks followed suit, with S&P 500 futures bouncing back to 6,840.
While crypto traders celebrate, the bond market is screaming caution. Is this the calm before a sustained recovery, or is the bond market trying to tell us something that stock and crypto investors are ignoring?
The bond market is betting that the recent oil price spike will make goods more expensive soon. This complicates the Federal Reserve’s situation. Before this week, the market saw an 80% chance of two rate cuts this year. Now? That probability has plummeted to less than 50%.
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Why Prices Are Up But Stress Is Building?
The Fed is trapped.
Oil pushing toward $82. Inflation rising.
Stocks selling off. Growth slowing.
Rate at 3.5-3.75%. No room to cut.Next meeting March 17. They will do nothing.
And doing nothing is the worst possible outcome.
Stagflation isn't a theory. It's here. pic.twitter.com/5oY8m7avBG
— Michael A. Gayed, CFA (@leadlagreport) March 5, 2026
Similar to how tariff fears can trigger sudden price drops by altering the inflation outlook, an energy shock forces the Fed to tap the brakes rather than hit the gas. If yields continue to rise toward 4.25% or higher, it could suck the liquidity out of the crypto market, regardless of how bullish the charts look right now.
The week began with a sharp sell-off triggered by spiking crude oil prices, driven by fears of conflict in the Strait of Hormuz. Markets hate uncertainty, and the initial reaction was a classic flight to safety, sending Bitcoin tumbling toward $65,000. However, the market stabilized quickly after the US promised naval escorts for tankers, calming the immediate fear of a supply crunch.
But here is the twist: while stock and crypto prices recovered, the stress didn’t disappear.
The yield on the 10-year US Treasury note has climbed for four consecutive days, jumping from 3.93% to 4.15%. While we have seen how institutions often buy the dip during geopolitical tension, the bond market is signaling that the underlying economic conditions are getting tighter, not looser.
The bullish flipside, however, is that Bitcoin has shown surprising resilience. It is currently acting as a hedge against geopolitical chaos rather than just a risk asset. If the oil situation stabilizes without sparking broader inflation, those Fed rate cut bets could return just as quickly as they vanished.
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Bitcoin’s Key Level To Watch Is $74,000
Bitcoin is currently trading comfortably above the $70,000 psychological level, but the real test is higher.
The level to watch is $74,000. This was the peak reached on Wednesday during the rebound before sellers stepped back in. If Bitcoin can break and close above $74,000, it would signal that demand is strong enough to ignore the warning signs from the bond market.
Experts like Jan van Eck have previously noted that Bitcoin’s cycles are increasingly driven by adoption rather than just rate sensitivity, which supports the bullish case for a breakout.
Bryan Tan, a trader at Wintermute, noted that “the rates market is revealing the tension in this rally.” Essentially, you have a resilient economy clashing with a potential energy shock. History tells us that this specific combination often forces the Federal Reserve to keep interest rates high, which usually acts as a ceiling for risk assets like Bitcoin.
Conversely, the bear case activates if $70,000 fails to hold. The weekend low of $65,000 is the critical support.
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Key Takeaways
- Bitcoin and stocks have stabilized after the initial shock, but the 10-year Treasury yield has quietly climbed to 4.15%, signaling caution.
- Investors have drastically reduced their expectations for Fed support, with the odds of two rate cuts dropping from 80% to under 50%.
- The critical resistance level to watch is $74,000; breaking this would invalidate the bearish signal from the bond market.
The post Bitcoin, Stocks Stabilize But The Bond Market Isn’t Convinced: Will The Fed Cut Rates Now? appeared first on 99Bitcoins.