Bitcoin Stalls at $65,000 as Hedge Funds Dump Tech Stocks

Bitcoin, the world’s leading cryptocurrency, is widely viewed as a barometer for risk assets. A recent escalation in geopolitical conflict has pushed oil prices higher, while stress in Japan’s bond market and the prospect of selling by Strategy have heightened investor concerns about a renewed global regulatory crackdown. Together, these headwinds have put Bitcoin at risk of retesting a key psychological threshold. Whether that support holds will be an important signal for the broader digital asset market.

Geopolitical risks weighed on risk assets after former US President Donald Trump warned in mid-July that the United States would forcibly operate the blocked Strait of Hormuz. Bitcoin briefly fell below $62,000 on July 15 before testing support at $60,000. The latest data, however, showed signs that panic selling was stabilizing on July 16 as sellers’ profit margins fell to zero. The market is now watching closely to see whether Bitcoin can hold the $60,000 level.

As a non-yielding asset, Bitcoin is particularly sensitive to interest rates, the dollar and market liquidity. Federal Reserve Chair Kevin Warsh’s comments about persistent inflation briefly spurred demand for safe-haven assets. But rising Treasury yields, strong earnings from AI technology stocks and continued outflows from U.S. spot Bitcoin ETFs redirected capital toward fixed-income and equity markets.

A July 2 report showed Bitcoin climbing back above $60,000 on Wednesday, though it remained 53% below its all-time high. The five-year U.S. Treasury yield rose to 4.22%, while CME FedWatch put the probability of a rate increase by September 16 at 64%, up from 23% a month earlier. With the dollar index closing in on a one-year high, the market increasingly viewed a near-term advance to $65,000 as more difficult.

Bitcoin has often moved in tandem with higher-risk technology assets such as the Nasdaq, but investors have recently shifted toward artificial intelligence (AI) stocks, while a stronger U.S. dollar index has also weighed on demand for crypto assets. The divergence shows that gains in technology shares are no longer directly lifting Bitcoin, making $60,000 a key battleground between bulls and bears.

In the latest trading, Bitcoin failed to reclaim $67,200 and then corrected by about 7%, coming close to $60,000 before moving back above the level. Ether (ETH) and Solana (SOL) also recouped some of their losses, while AI stocks rebounded over the same period. If Bitcoin falls below $60,000 again, downside risks would rise significantly.

Bitcoin's latest decline was triggered by an escalation in the war involving Iran, new U.S. government tariff policies and a stronger yen, with risk assets coming under pressure across the board. The cryptocurrency market has lost about $2 trillion in value, reflecting a marked retreat in capital and liquidity. The $60,000 level is both a technical support zone and a key psychological threshold, making it central to whether the selloff deepens.

Bitcoin recently fell below $65,025, initially triggering more than $430 million in long liquidations. As the price moved closer to $60,000, long liquidations swelled to more than $600 million. Crypto liquidations across the market exceeded $1.1 billion at one point over 24 hours, affecting nearly 200,000 traders. Traders had estimated a 53% chance that Bitcoin would fall below $66,000 by April 24, while the market also saw about $1 billion in put-option bets at the $60,000 level.

Bitcoin rebounded to a nearly two-month high in mid-April 2026 but repeatedly stalled near $75,000. By contrast, optimism over AI and corporate earnings propelled the Nasdaq and S&P 500 to record highs. The divergence between the two classes of risk assets reflects investors’ preference for U.S. equities and makes $75,000 a key threshold for crypto market confidence and breakout momentum.

As of May 27, 2026, Bitcoin was down 1.81% over 24 hours at $75,850, failing to follow U.S. stocks higher. The S&P 500 rose 0.61% to close at 7,519.12, while the Nasdaq gained 1.19% to finish at 26,656.18. Hyblock said nearly $400 million in open positions had accumulated between $72,200 and $72,400, creating a key support zone that bulls must defend.

Bitcoin is widely viewed as a gauge of global risk appetite, while the area around $77,000 also overlaps with the cost basis of short-term holders. Whether it can sustain a breakout has implications for spot ETFs, derivatives and onchain positioning. Checkonchain said more than 15% of the circulating supply was acquired between $74,000 and $83,000, making pullback risk a particular concern around this dense zone of underwater holdings.

Bitcoin briefly approached $77,500 on May 1. Open interest in Deribit put options with a $76,000 strike and a June 26 expiry rose 22.5%. Santiment data also showed that more than $770 million in BTC flowed onto exchanges during the previous week. By May 25, weekly net inflows stood at about 18,000 BTC, leaving the rebound exposed to potential selling pressure.