Bitcoin and gold extended losses Tuesday as geopolitical tension increased ahead of U.S.–Iran nuclear talks scheduled for February 17 in Geneva. U.S. President Donald Trump said he would be involved “indirectly” in the negotiations and warned that Iran would not want to face the consequences of failing to reach a deal.
Speaking aboard Air Force One, Trump expressed confidence that an agreement is possible. Still, markets reacted cautiously. The United States has deployed a second aircraft carrier to the Middle East, while Iran conducted military drills in the Strait of Hormuz, a key oil shipping route. The military buildup has intensified investor anxiety.
Diplomatic efforts continue. Oman’s Foreign Minister Badr Al Busaidi met with Iran’s Foreign Minister Abbas Araghchi in Geneva to prepare for a second round of indirect talks mediated by Oman. Both sides signaled a desire to move toward a mutually acceptable agreement.
Markets dislike uncertainty. When political risks rise, investors often shift money quickly, creating volatility across assets.
Gold Slips Despite Bullish Bets
Gold prices fell below $4,950, marking a second straight session of declines. A stronger U.S. dollar added pressure, making gold more expensive for international buyers.
Yet investor positioning tells a more complex story. After COMEX gold futures recorded one of their largest single-day drops in decades, traders began accumulating December $15,000–$20,000 call spreads. That position has grown to nearly 11,000 contracts, even as gold consolidates near the $5,000 level.
Recent U.S. inflation data also shaped expectations. Last Friday’s consumer price index (CPI) report came in lower than expected, increasing hopes for monetary easing later this year. According to the CME FedWatch Tool, traders are pricing in two Federal Reserve rate cuts, with a 52% probability of the first cut occurring in June.
Key gold market signals:
- Gold below $4,950 after two sessions of losses
- Nearly 11,000 December call spread contracts in place
- 52% odds of a June Fed rate cut
If geopolitical tensions ease, risk appetite could return. If talks fail, safe-haven flows may increase again.
Bitcoin Holds Near $68K
Bitcoin is trading near $68,200, down about 0.25% over the past 24 hours. The cryptocurrency’s daily range shows a high of $70,067 and a low of $67,301. Trading volume remains subdued as investors await clarity from Geneva.
Unlike gold, Bitcoin has recently shown stronger correlation with technology stocks. During periods of uncertainty, crypto has sometimes fallen alongside equities rather than acting as a safe haven.
Sentiment indicators reflect caution. The Crypto Fear & Greed Index has dropped to extreme fear levels, signaling bearish mood among investors. However, Matrixport suggests that durable bottoms often form when its proprietary 21-day Greed & Fear Index falls below zero and then reverses higher. Historically, such deeply negative readings have preceded attractive entry points.
For new investors, the takeaway is simple: prices move based on news, interest rates and emotion. With Bitcoin near $68,200 and gold under $4,950, markets are waiting for the outcome of February 17 talks to decide the next direction.
