(Kitco News) – Stocks fell under pressure in early trading on Tuesday while gold climbed higher and Bitcoin (BTC) held steady as fears about an escalation in the Russia-Ukraine war, including possible nuclear escalation, rattled markets and gave traders reason to pause.
“Overnight, the major indices built on Monday’s gains but then sold off sharply on the European open,” noted David Morrison, Senior Market Analyst at Trade Nation. “Investors were rattled by a statement from Russian President Vladimir Putin concerning the use of nuclear weapons, should Russia be attacked by conventional weapons backed by a nuclear power.”
Shortly after Putin signed a revised nuclear doctrine that allows Russia to expand its use of atomic weapons, Ukraine deployed ATACMS missiles to strike a military facility in the western Bryansk region, according to a statement released by Russia’s Defense Ministry on Telegram.
“This has taken the Dow, S&P, NASDAQ and Russell 2000 back to support once again, indicating that investors remain nervous with the stock price of many corporations trading at rarified levels,” Morrison said. “So far, support has held at the top end of this range which is positive news for the bulls. If prices can continue to steady, then there’s a reasonable chance that US stock indices could soon have another attempt to take out the record closes hit at the beginning of last week. But there are also reasons to be cautious.”
One of the main reasons to be cautious is elevated bond yields, he said. “US Treasuries have rallied sharply since mid-September, following the Fed’s 50 basis point rate cut. Yields jumped again after Trump’s election victory. The key 10-year has pulled back from its highest levels, and is down around 4 basis points this morning. But it remains elevated, and not far below 4.50% - a level which could, if breached, cause concern for investors, leading to a drop in risk appetite.”
While stocks retreated amid the Russia-Ukraine escalation, gold made gains as the return of the safe haven play helped boost the yellow metal. At the time of writing, spot gold trades at $2,624.10/oz for a gain of 0.51% on the session.
Data provided by TradingView shows that after sliding to a low of $90,305 late on Monday, Bitcoin bulls reversed course and rallied to a high of $92,856 in the early hours on Tuesday before the Russia-Ukraine situation sparked a whipsaw that saw BTC retest support at $91,000 before once again trending higher.
BTC/USD Chart by TradingView
“The cryptocurrency market is down 0.5% in 24 hours to $3.08 trillion,” noted Alex Kuptsikevich, chief market analyst at FxPro. “The market has paused after rallying since the end of last week. Ethereum and Litecoin have pulled back from recent highs, while XRP is stabilizing. Bitcoin and Solana are hovering near recent highs and are getting ready to update them.”
“As a result, the sentiment index reached 90 for only the third time this year—it was only higher at the end of 2020,” he added. “This sentiment confirms that traders are sticking to the four-year halving cycles. In 2020, price records attracted companies to buy the first currency in reserve to support market interest in equities. By 2024, even politicians seem to be scoring PR points by showing their commitment to Bitcoin.”
Kuptsikevich said that if Bitcoin can meaningfully break above the high of $93.3k set on Nov. 13, that “would signal an entry into a growth extension with a target of $110K after a corrective pullback to 76.4% of the initial momentum. Such shallow corrections are typical of strong bull markets when buyers quickly return.”
TradingView analyst TradingShot sees a similar outlook moving forward and said Bitcoin is on track to hit $120,000.
“Following Bitcoin's new All-Time High in the aftermath of the U.S. elections, we've established on previous posts that we've entered the final year (12 months) of this Bull Cycle,” he said in a Tuesday Bitcoin update. “This is clearly visible by the use of the Sine Waves as shown on this 1W chart.”
“The new aspect we're bringing to you today is the Pi Cycle indicator, which has proven to be as consistent as any other at projecting the long-term price action of Bitcoin,” he said. “As you can see, every Cycle Top has been considerably above the Top Pi Band (red trend-line), and we're currently trading 30k below where this level is now. This means that it is only a matter of time for BTC to 'attack' 120k and break it.”
Following the test of support at the 1W MA50 back in early August, TradingShot said, “We are at a point where the new rally phase” has started, adding that the price action “will start getting more and more aggressive.”
“The final bullish signal was given last week after the 1W RSI closed above 70.00 (vertical orange dashed line),” he highlighted. “As you can see, during the previous two Cycles, every time Bitcoin closed the 1W RSI above 70.00, the Cycle peaked 54 weeks later (roughly 365 days). There is no reason to expect otherwise this time also, as this projected date (week of November 24 2025) falls exactly on the Sine Wave's Top.”
He also noted that “during the most aggressive part of the Parabolic Rally, the 1D MA100 (blue trend-line) tends to Support. And before that, when that crosses above the Bottom Pi band (green trend-line), the indicator gives a confirmed buy signal for the whole Cycle.”
“The question now is how high can the price get? Well, according to those estimates, a peak above the Top Pi Band can be anywhere within the 150k - 200k range, and that could be a conservative estimate,” TradingShot concluded.
At the time of writing, Bitcoin trades at $92,407, an increase of 0.69% on the 24-hour chart.
