Market Update: Bitcoin Falls Below $66K While Oil Rally Hits Investor Sentiment

Alphabet’s earnings report later Wednesday is set to provide investors with a key update on whether the hundreds of billions being invested in artificial intelligence are starting to generate meaningful results.

Trump Warns of U.S. Response to Strait of Hormuz Attacks

President Donald Trump threatened further action against Iran, warning that any attacks on ships passing through the Strait of Hormuz would trigger U.S. retaliation.

In a message shared on Truth Social, Trump said attacks involving missiles, rockets, drones, or other weapons would lead to strikes against infrastructure targets, including bridges and power plants.

The statement had limited influence on markets, however, as crude oil remained elevated while stocks and cryptocurrencies continued to trade lower.

OpenAI Raises Long-Term AI Compute Spending Forecast

OpenAI has reportedly increased its expected investment in computing resources to about $750 billion through 2030, according to The Wall Street Journal. The figure is up from a previous estimate of $600 billion.

The additional spending is intended to secure the computing capacity required to train and operate the company’s expanding range of AI models.

The investment includes new data center developments, including the recently announced $20 billion “Project Camellia” facility in Georgia.

Benchmark Boosts Hut 8 Target After New Data Center Agreement

Benchmark analyst Mark Palmer maintained a buy recommendation on Hut 8 while increasing his price target from $165 to $195 following the company’s latest data center expansion deal.

The revised target follows Hut 8’s agreement on a second $9.8 billion, 15-year lease at its Beacon Point campus, representing nearly 80% upside from the company’s previous close of $108.98.

Palmer’s valuation model includes the estimated value of Hut 8’s River Bend and Beacon Point contracts, its 60% stake in American Bitcoin Corp., and the company’s 10,667 BTC holdings reported at the end of March.

Hut 8 shares traded about 1.35% lower in pre-market activity.

Oil Rally Hits Risk Assets as Crude Climbs to Six-Week High

Renewed tensions between the U.S. and Iran pushed WTI crude prices another 3.2% higher on Wednesday, reaching $87.38 per barrel—the strongest level since early June.

The oil surge has revived inflation concerns, pressuring bond markets as both two-year and ten-year Treasury yields reached fresh cycle highs.

Earlier in the week, traders had largely removed the possibility of a Federal Reserve rate hike from expectations. However, the odds have since climbed to nearly 30%.

The shift weighed on risk assets, with Nasdaq 100 futures down 0.8%. Bitcoin also retreated below $66,000 after briefly touching $66,900 the previous day.

Bitcoin Traders Monitor $63K Support

Bitcoin’s short-term outlook remains tied to three major factors: developments in the U.S.-Iran conflict, market sentiment during earnings season, and the Federal Reserve’s policy outlook, according to Daniela Hathorn, senior market analyst at Capital.com.

Hathorn highlighted $63,000 as a critical support level where buyers have repeatedly stepped in. Maintaining that level would suggest the recent pullback is stabilizing, while a breakdown could trigger further selling.

On the upside, the $65,000–$66,000 region remains the key area to reclaim. A sustained move above this zone could strengthen momentum and open the door to a challenge of recent highs.

Tesla’s AI Spending Expectations Differ From Big Tech

Tesla’s upcoming earnings report comes with a different investor focus compared with other major technology companies.

While investors want Alphabet and other tech giants to demonstrate that massive AI investments are paying off, Tesla shareholders appear to favor increased AI spending.

Tesla shares are down 16% this year, and unlike many of its peers, a larger AI investment outlook could potentially boost the stock rather than weigh on sentiment, according to Bloomberg.

Bitcoin ETFs Record Sixth Straight Day of Inflows

U.S. spot Bitcoin ETFs extended their positive streak to six consecutive sessions, attracting $203 million in net inflows on Tuesday, according to SoSoValue data.

The run represents the longest stretch of ETF inflows in three months. Ethereum ETFs also saw positive demand, recording $37.5 million in inflows.

Bitcoin ETFs added approximately $930 million during the six-day streak, although that remains below the $2.5 billion that left the products during the eight-day outflow period in late June.

Total ETF assets have climbed to nearly $81 billion, the highest level since mid-June. Bitcoin gained about 2.8% during the streak, reaching $66,900 on Tuesday, its strongest level since June 16.

Bitcoin Holds Near $66K Ahead of Alphabet Earnings

Bitcoin traded around $65,900 on Wednesday, staying below its recent two-week peak while remaining up roughly 1.5% over the week.

The consolidation mirrored broader market movements as a two-day recovery in semiconductor stocks stalled ahead of Alphabet’s earnings release.

Nasdaq 100 futures fell 0.8%, South Korea’s Kospi lost some of its earlier gains, and European technology shares also weakened.

Alphabet previously announced plans to increase annual capital spending to as much as $190 billion. Investors are now looking for confirmation that this AI spending boom is producing sufficient returns, particularly as semiconductor stocks face concerns over the sustainability of AI investment growth.

Bitcoin has followed the AI trade closely this month, gaining during periods of strength in chip stocks and weakening when technology shares come under pressure. The connection reflects broader risk appetite and the increasing shift of Bitcoin miners toward AI-focused data center businesses.

Ether remained near $1,917, up about 2% over the week, while Hyperliquid lagged with a 2% weekly decline.

Markets now await Alphabet’s results and the Federal Reserve’s July 28–29 meeting for further clues on the direction of risk assets.