The Question Isn’t If Bitcoin Pumps — It’s When

Global markets are bracing for increased volatility this weekend as escalating geopolitical tensions in the Middle East converge with historic technical extremes in the commodities sector. While gold and copper approach critical supply and valuation inflection points, cryptocurrency markets remain precarious, facing key technical resistance levels amid fears of potential military action involving the United States and Iran.

Key Points

• Geopolitical Risk: Reports of U.S. naval movements toward the Persian Gulf suggest potential strikes on Iran, a scenario likely to trigger significant weekend market volatility.
• Commodities Overheating: Gold’s monthly Relative Strength Index (RSI) has hit 95.2, a level not seen since July 1973, signaling a potential "blowoff top" or irrational exuberance.
• Copper Supply Crisis: Analysts project a massive supply deficit, noting the world must mine as much copper in the next 18 years as in the last 10,000 years to meet demand.
• Crypto Weakness: Bitcoin and Ethereum are potentially forming bearish technical patterns, with Bitcoin needing to reclaim the $91,000 level to invalidate further downside risk.
• Macro Stability: The Bank of Japan held interest rates at 0.75%, temporarily alleviating fears of a Yen carry trade unwind.

Commodities Market Reaches Historic Extremes

The precious metals market is currently exhibiting signs of historic euphoria. Gold has rallied aggressively, gaining approximately $700 in a single month. Technical analysis reveals that the monthly RSI for gold sits at 95.2. For context, the last time the RSI reached this level was in July 1973. While that period marked a local top followed by a correction, it was not the end of the long-term trend, which eventually peaked in 1980.

Despite the long-term bullish case driven by currency debasement and lack of faith in sovereign debt, the current vertical trajectory warns of rising danger for immediate buyers.

"The debasement trade is not just in. It’s ripping people's faces off. Gold is up 80% in one year, Platinum is up 175%, and Silver is up 200%," noted financial commentator James Lavish.

The Copper Supply Crunch

Beyond precious metals, the industrial metals sector is facing a structural crisis. Copper, essential for electrification and AI data centers, faces a projected 33% supply deficit over the coming decade. The sheer scale of required production is staggering.

"We are consuming 30 million tons of copper a year... To maintain a 3% GDP growth with no electrification, we have to mine the same amount of copper in the next 18 years we mined in the last 10,000 years combined," stated billionaire mining financier Robert Friedland.

This "commodity super-cycle" is further supported by U.S. government initiatives to regain supply chain independence. Billions in investment are expected to flow into the mining sector to secure critical minerals, including lithium and nickel, which face deficits of 38% and 15% respectively.

Crypto Markets Face Technical Headwinds

In contrast to the equities and commodities rallies, the cryptocurrency market is showing signs of weakness. Bitcoin is currently struggling below its 20-day Exponential Moving Average (EMA), currently situated around $91,000. Analysts warn that failure to reclaim this level could validate a "bear flag" pattern, implying further downside.

Institutional flows offer a mixed signal. After over a billion dollars in outflows earlier in the week, selling pressure has slowed significantly. Bitcoin ETFs saw a reduced outflow of $32 million, while Ethereum saw $42 million in outflows. Solana remains a bright spot with continued net inflows.

Investors are also wary of the "Trump Playbook"—a strategic timing of geopolitical actions where major announcements or military strikes occur after markets close on Friday, allowing volatility to absorb over the weekend before traditional markets reopen Monday. Given crypto trades 24/7, digital assets often bear the immediate brunt of such news.

Equities and Macroeconomic Outlook

Broader equity markets remain resilient, aided by the de-escalation of tariff threats between the U.S. and Europe. Additionally, the Bank of Japan provided stability by maintaining its key policy rate at 0.75% and raising economic growth forecasts. This decision mitigated fears of a rate hike that could have disrupted global liquidity via the Yen carry trade.

In the technology sector, key stocks are showing bullish momentum:

• AMD: Showing potential for a breakout with technical targets possibly reaching $340, though RSI levels are heating up.
• Meta: Bouncing off long-term trend lines, with a potential move back toward $665 and eventually all-time highs.
• Iron Mountain (IRM): The company moved its earnings date forward from February 11 to February 5. Historically, moving earnings dates forward is interpreted as a sign of confidence and positive news.

As the weekend approaches, market participants are advised to monitor geopolitical developments closely. While the long-term thesis for commodities and hard assets remains intact, the immediate term presents heightened risk of volatility across all asset classes.