Bitcoin (BTC) dropped below $65,000 on Thursday as United States equities declined during another phase of escalation involving Iran.

Several days of US-Iran tensions began to weigh on both cryptocurrency and stock market performance. Bitcoin reached a three-day low below $65,000, while traders remained divided over the asset's near-term direction. A nearby moving-average trend line also emerged as an important support level. Geopolitical risk events have periodically driven up correlation between Bitcoin and equities, as investors broadly reduce exposure to volatile assets during periods of uncertainty.

Bitcoin weakens as Iran tensions unsettle stocks, oil and bond yields

Data from TradingView showed BTC/USD falling to a three-day low of $64,799 on Bitstamp.

Risk assets came under pressure during the session after US President Donald Trump warned that he would hold Iran responsible for recent Houthi strikes on Saudi Arabian commercial vessels.

In a post on Truth Social, Trump said he was "very disappointed" in the Houthis, referring to attacks on US ships from 2025.

By the close of trading in New York, the S&P 500 was down 1.2% and the Nasdaq had lost 2.2%. Oil prices climbed to their highest levels since early June, with Brent crude rising above $100 per barrel. Rising energy costs feed directly into inflation metrics that the Federal Reserve monitors, complicating the rate-cut path that markets had been pricing in earlier in the year.

"Inflation expectations and interest rates are rising sharply again," trading resource The Kobeissi Letter wrote in a response on X.

Ahead of the Federal Reserve's next interest-rate decision, data from CME Group's FedWatch Tool showed that the probability of officials raising rates by 0.25% had increased. Such a move has traditionally been a headwind for crypto markets, as tighter monetary policy reduces liquidity and raises the opportunity cost of holding non-yielding assets. The odds approached 40% on Thursday, compared with about 12% one week earlier.

The Kobeissi Letter also noted that US 10-year Treasury yields had reached 18-month highs, pointing to renewed economic pressure.

Traders split as BTC price analysis highlights $73,000 target

Bitcoin traders became increasingly divided over the likely direction of short-term BTC price action.

Commentator Exitpump said the Bitcoin relief rally was likely to end by late July, reinforcing an existing theory that had already gained attention.

"July rally is coming to end, price is at resistance, close your longs, go short once price breaks below 65K," Exitpump told followers on X late Wednesday.

Other market participants were more constructive. Trader Jelle said the price was "still making progress."

"Clear this local area and that void towards $70k opens up - could be a quick move to form the new range. Patience remains my game," Jelle wrote.

Crypto trader and analyst Michaël van de Poppe said the 21-week simple moving average (SMA), at $64,073, was a key level. The 21-week SMA is widely tracked by analysts as a long-term trend indicator; Bitcoin has bounced off this line during prior bull cycles, making it a critical level for sustaining bullish momentum.

"Theoretically, the target area for Bitcoin is reached. However, as long as this stays above the 21-Day MA, I'm sure there will be a higher valuation for Bitcoin in the near-term," van de Poppe wrote in an X post on Thursday.

He added: "It's facing the final hurdle for a big breakout, which is the $68,000 resistance zone. It's been tested once, and this is the second test that we'll be facing."

Van de Poppe identified $73,000 as a target if bulls manage to break through resistance successfully.