Bitcoin Maintains Uptrend as Institutional Flows Return, but Profit-Taking Risks Remain

Since February 26, when geopolitical tensions between the United States and Iran began to escalate, Bitcoin has surged nearly 12% from a low around $65,600 to a peak near $74,000, before pulling back slightly and currently trading around $72,500. This performance has outpaced several other financial assets, raising the view that the world’s largest cryptocurrency may increasingly exhibit characteristics of a “digital safe-haven” amid rising geopolitical risks.

However, after a multi-session rally, Bitcoin may face short-term profit-taking pressure, particularly as prices approach key resistance levels. In addition, despite the recent return of ETF inflows, the overall scale of these capital flows remains relatively modest, indicating that institutional buying may not yet be strong enough to sustain a prolonged bullish trend.

These factors could act as headwinds to extending Bitcoin’s upward momentum in the near term. Looking ahead, markets will closely monitor policy signals from the U.S. Federal Reserve (Fed). The recent surge in energy prices amid escalating geopolitical tensions could heighten the risk of renewed inflationary pressures, potentially prompting the Fed to maintain a restrictive monetary policy stance for longer.

As a result, market participants are paying attention not only to the interest rate decision, but also to the tone of the Fed’s policy guidance relative to current market expectations. If the Fed delivers a more hawkish signal than currently priced in, particularly by emphasizing the need to keep interest rates higher for longer to control inflation, it could place pressure on risk assets, including Bitcoin.

Conversely, if the Fed adopts a more balanced stance or signals less policy rigidity than expected, risk sentiment could improve, potentially supporting Bitcoin’s upward trajectory over the medium term.