Key Highlights
- BTC maintained trading levels above $70,000 heading into Friday, posting approximately 7% gains across the week despite significant fluctuations
- International equity markets bounced back from midweek losses, pushing S&P 500 futures toward the 6,840 level
- Crude oil jumped more than 16% during the week following Iran’s tanker blockade in the Strait of Hormuz
- 10-year Treasury yields advanced for four consecutive sessions, moving from 3.93% to 4.15%
- Market expectations for two Fed rate reductions this year dropped from approximately 80% to below 50%
Bitcoin maintained its position north of $70,000 heading into Friday’s session while international equity markets found stability following a volatile week marked by escalating Middle East tensions. Meanwhile, fixed-income markets are painting a more concerning picture.
The trading week opened with substantial selling pressure across risk-sensitive assets after Iran initiated a blockade of oil tankers navigating the Strait of Hormuz, a critical waterway responsible for approximately one-fifth of global oil shipments. This geopolitical escalation pushed crude prices higher by over 16% across the week, marking the strongest weekly performance since March 2022.
Bitcoin experienced a weekend decline to approximately $65,000 before mounting a recovery. The leading cryptocurrency momentarily touched $74,000 during Wednesday’s trading before settling back to $70,182 by Friday’s opening, positioning itself for approximately 7% weekly gains.
Equity indices mirrored this trajectory. S&P 500 futures touched multi-week lows at 6,718 during Tuesday’s session before climbing back toward 6,840. The Dow Jones Industrial Average posted losses exceeding 2% for the week and moved into negative territory for the 2026 calendar year. The tech-heavy Nasdaq demonstrated greater resilience, trending toward modest weekly gains.
Washington’s commitment to provide naval protection for commercial tankers traversing the strait helped ease initial market anxiety. Nevertheless, energy costs remained at elevated levels.
Treasury Market Sends Cautionary Signals
The more significant development for financial markets is unfolding in the bond sector. The benchmark 10-year U.S. Treasury yield advanced during four consecutive trading sessions, rising from 3.93% to reach 4.15%. Meanwhile, the two-year note yield surged from 3.37% to approach 3.60%.
Increasing yields signal mounting anxiety that elevated energy costs will reignite inflationary pressures, constraining the Federal Reserve’s flexibility to reduce interest rates.
Prior to the Middle East crisis, market participants had priced in roughly 80% probability for two Fed rate reductions during the current year. This expectation has now fallen beneath the 50% threshold.
Bryan Tan, a trader at Wintermute, said the rates market is “revealing the tension in this rally,” pointing to strong economic data alongside an inflationary energy shock as a combination that could keep the Fed on hold longer.
Latest economic indicators from the United States reinforced this narrative. The ISM Services index registered 56.1 for February, demonstrating ongoing economic expansion. The ADP employment report revealed 63,000 new private sector positions, exceeding the anticipated 50,000 and representing the strongest reading since July 2025.
Alternative Cryptocurrencies Face Headwinds
The majority of leading alternative cryptocurrencies declined during Friday’s session. Ethereum retreated 3% to settle at $2,069. XRP decreased 1.8% to reach $1.39. Solana slipped 1.6%, while both Cardano and Polygon registered 2.5% losses. Dogecoin similarly declined 1.8%.
Precious metals headed for weekly losses despite persistent geopolitical uncertainty, pressured by U.S. dollar strength.
Market analyst Jack Prandelli observed that oil prices historically advance 20–30% within 60-day periods following significant geopolitical disruptions, suggesting current market pricing may be inadequately accounting for supply disruption risks.
Market attention now shifts to Friday’s employment situation report. Economic forecasters anticipate job creation around 55,000, representing a decline from January’s 130,000 figure. A stronger-than-projected reading could drive yields to even higher levels.
