Bitcoin Recovers $64,000 on Institutional Fund Inflow…Oil Price Rebound Holds it Back

▲ US, Iran, International Oil Prices, Strait of Hormuz, Bitcoin (BTC)/AI Generated Image ©

Bitcoin (BTC) has recovered $64,000, buoyed by the return of institutional funds, but uncertainty over peace talks between the US and Iran and a rebound in international oil prices are fueling inflation concerns and limiting further upside.

On August 4 (local time), according to investment media FXStreet, Bitcoin recovered $64,000 on Tuesday, overcoming the previous day's modest correction. Improved institutional demand supported the price, but geopolitical tensions in the Middle East and rising energy prices, along with the possibility of hawkish policies from the US Federal Reserve (Fed), pressured risk asset investor sentiment.

Iran denied President Donald Trump's claim that negotiations with the US were underway, and the Islamic Revolutionary Guard Corps (IRGC) reportedly attacked a US military base in Kuwait with drones. Iran also dismissed the possibility of reopening the Strait of Hormuz, and with the blockade of Saudi Arabian waters by pro-Iranian Houthi rebels, the geopolitical risk premium on international oil prices has risen again. If rising energy prices stimulate inflation, the Fed's tightening stance could be strengthened.

The US Chicago Mercantile Exchange (CME) FedWatch tool reflected a 64.7% probability of a rate hike in September. The fact that the US Institute for Supply Management (ISM) Manufacturing Purchasing Managers' Index (PMI) for July reached its highest level in over four years also supported the outlook for interest rate hikes and a stronger dollar. Strong economic indicators and a rebound in oil prices are factors limiting the upside potential for risk assets, including Bitcoin.

On the other hand, institutional demand showed signs of recovery. According to SoSoValue, US Bitcoin spot ETFs saw a net inflow of $170.09 million on Monday. The previous week had seen a net outflow of $61.53 million. However, the daily trading volume across 44 spot exchanges tracked by Kaiko fell to $15 billion last week, marking a year-low. This is 70% lower than the peak in January. The average daily trading volume also decreased by 50% to $20 billion since December 2025, showing that market liquidity is rapidly drying up.

Technically, Bitcoin traded around $63,800 on Tuesday, falling below its 50-day exponential moving average (EMA) of $64,653, its 100-day EMA of $67,134, and its 200-day EMA of $72,615. The Relative Strength Index (RSI) recorded a neutral level of 49, but the Moving Average Convergence Divergence (MACD) remained below the zero line, maintaining a short-term bearish trend. If it breaks above $64,004 and $64,653, it could test $67,134 and $72,615 respectively. Conversely, if it fails to rebound, the possibility of a further drop to the psychological support level of $60,000 opens up.

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