"Bitcoin faces a triple squeeze from rates, war and inflation…cash preference intensifies"

Bitcoin is coming under downside pressure as rising interest rates, the war in the Middle East and inflation worries converge.

On the 25th (local time), cryptocurrency-focused outlet Cointelegraph reported that "Bitcoin has recently retested the $67,500 support level, extending its bearish tone."

The decline is seen as the result of growing selling pressure across risk assets as fears of a prolonged Iran war combine with higher oil prices. Crude has held above $85 a barrel, adding to upward inflation pressures.

Shifts have also been detected in the U.S. Treasury market. The 5-year Treasury yield rose to 4.10%, the highest level in nine months. As bond prices fell and investors demanded higher yields, a trend emerged toward increasing cash allocations.

Investors in fact appeared to be selling both gold and bonds at the same time and moving to secure cash. Over the same period, the S&P 500 fell to its lowest level in six months, underscoring a broader liquidity squeeze.

Markets are also pricing in the possibility that the Fed could keep tightening. According to CME FedWatch, the probability of a rate hike at the July Federal Open Market Committee (FOMC) meeting jumped to 20.5% from 0% a week earlier.

The U.S. fiscal situation is also a headwind. National debt has topped $39 trillion, and discussions are under way over additional war-related spending.

Weakness in tech stocks is also weighing on sentiment. Over the past six weeks, major tech names including Google, Meta and IBM have fallen more than 10%.

With higher rates, inflation pressures and geopolitical risk all acting at once, investors are expanding defensive, cash-heavy positions.

Cointelegraph said that "regardless of on-chain indicators, the macro backdrop is capping Bitcoin's upside," adding that "the possibility of a retest of $66,000 still remains."