Bitcoin (CRYPTO: BTC) has surged 14% since the Iran war began on February 28, outperforming the MSCI World Index and gold, which are down 4% and 5%, respectively.

Still, analysts warn the rally may fizzle by April and worsen by August.

The Outperformance Numbers

This marks a sharp contrast to the spectacular crash in October 2025, which saw Bitcoin’s value halve from its high above $126,000.

Crude oil surged more than 40%, bullion dropped roughly 5% for the month, and the MSCI World Index fell 4%. 

Bitcoin has been an oasis of calm relative to the volatility in equities, gold, and oil.

“Bitcoin’s resilience here is less about narrative and more about mechanics,” said Rachael Lucas, an analyst at BTC Markets. “Institutional buyers, particularly corporate treasuries, are absorbing supply on every dip.”

The Put Unwind Catalyst

Markus Thielen, head of research at 10x Research, says traders partly drove the latest bullish signals by unwinding options bets that Bitcoin would fall below $55,000-$60,000.

“The selling or closing of Bitcoin put options reduces downside hedging pressure and forces market makers to buy BTC to rebalance their exposure, creating supportive flows that can push prices higher,” Thielen writes.

Deribit data shows traders have clustered about $1.5 billion in Bitcoin puts around $60,000, while they have placed $1.3 billion in calls at $75,000.

Bitcoin briefly plummeted after the U.S. and Israel initiated a bombing campaign against Iran on February 28, falling as low as $63,038.

The Bull Trap Warning

Hayden Hughes, managing partner at Tokenize Capital, suggests the current rally could soon reverse. 

While Bitcoin could touch $80,000 in the short term, he said the rally may fizzle out by next month and worsen by August.

“What started as a structurally supported recovery has transitioned into a momentum trade, where the original edge holders have already taken profit,” Hughes says.

The Market Structure Case

Trader Mayne argued the monthly, weekly, and three-day time frames remain in bearish structure despite the rally. 

A move from $60,000 to $80,000-$85,000 represents a 30-40% bounce, completely standard for a bear market rally.

“This thing can come all the way up to here and still be a lower high,” Mayne said, pointing to resistance around $90,000. 

The expectation is this ends in a lower high unless Bitcoin reclaims and holds key structural levels on the weekly chart.

Five red monthly candles in a row preceded this relief rally. The RSI was massively oversold, making the bounce expected rather than surprising.

Image: Shutterstock