Bitcoin remains below resistance area
Following its sharp mid-January to early February sharp sell-off, Bitcoin has managed to level out above its early February $60,132.75 over one year low since then.
Nonetheless the steep decline has reminded investors how sensitive the world’s largest cryptocurrency remains to shifts in macroeconomic sentiment, leverage dynamics and risk aversion. After a period of tentative stabilisation in January – supported by hopes of clearer regulatory frameworks, spot exchange-traded fund (ETF) inflows and the perception that forced deleveraging from late 2025 was largely behind it – Bitcoin’s technical structure and broader market conditions broke down sharply, leading to one of the more pronounced pullbacks in years.
The sell-off unfolded amid a broader tightening of financial conditions across global markets. In early February, data releases indicated that inflation remained sticky in key economies, prompting investors to reassess expectations around the timing and magnitude of interest-rate cuts by major central banks. Bond yields spiked, and risk assets such as equities and high-beta tech stocks faltered in response. Cryptocurrencies, which often mirror broader risk sentiment, did not act as the haven some traders had anticipated; instead, Bitcoin slipped quickly as capital rotated out of speculative exposures and into perceived safer assets.
Market positioning played a significant role in accelerating the downturn. In the weeks before the decline, derivatives data showed that leveraged long positions in Bitcoin had rebuilt, with traders anticipating a breakout above key resistance levels near the mid-$90,000s. When prices failed to sustain advances and instead violated short-term support, stop-loss orders were triggered and liquidations gathered pace. Funding rates for Bitcoin futures deteriorated as longs were forced out, and the rapid unwinding of leveraged exposure contributed materially to the severity of the decline, pushing prices lower than spot selling alone would have produced.
Compounding the technical drivers were flows in spot Bitcoin exchange-traded products. While early February saw modest inflows as institutional allocators added exposure at more attractive levels, those flows were inconsistent and quickly reversed in the face of heightened volatility. Large outflows from some legacy Bitcoin trusts – alongside tepid demand in newer ETFs – underscored a more tactical rather than conviction-driven approach from institutional participants. The absence of robust institutional dip buying during the initial phase of the sell-off left the market exposed to continued downside pressure.
Macro uncertainty outside the crypto sphere also shaped the narrative. Renewed geopolitical tensions and concerns about global economic growth added to risk-off sentiment, leading some investors to trim positions across correlated asset classes. Bitcoin’s reputation as a hedge has been tested repeatedly in recent cycles, and during this episode it behaved more like a high-beta risk asset than a store of value. This shift in perception contributed to broader selling momentum as traders sought liquidity and reduced exposure to volatile instruments.
Sentiment within the crypto community itself weighed on price action. Discussion around Bitcoin’s near-term trajectory turned increasingly cautious, with analysts and traders highlighting the challenges of reclaiming key technical zones above $90,000. A lack of fresh catalysts – such as definitive regulatory clarity, large-scale institutional adoption announcements or macroeconomic data that unequivocally supports easing – kept conviction low. In the absence of a compelling bullish narrative, many market participants were unwilling to aggressively defend lower levels.
Despite the severity of the sell-off, there are indications that the move has been driven more by mechanics and sentiment rather than by deterioration in Bitcoin’s long-term fundamentals. On-chain data continue to show robust long-term holding behaviour, with a significant portion of Bitcoin supply locked in wallets untouched for months or years. This persistent holding suggests that long-term conviction has not evaporated, even if short-term price action has been weak.
Looking ahead, Bitcoin’s near-term direction will likely depend on whether macro volatility stabilises and whether institutional demand can resume in a meaningful way. If risk assets across broader financial markets regain footing and liquidity conditions ease, Bitcoin may find firmer support and rebuild momentum. However, renewed macro stress or further unwinding of leveraged positions could prolong the downturn and keep prices under pressure.
For now, the recent sharp sell-off serves as a reminder that even Bitcoin – with its deep liquidity, institutional footprint and status as the flagship digital asset – remains vulnerable to broader market currents, shifts in sentiment, and technical dynamics that can amplify downside risk in periods of macro uncertainty.
Bitcoin bullish case:
As long as Bitcoin holds above last week’s $65,107.17 low, renewed attempts at breaking through the $70,040.75 – $73,757.39 resistance zone are expected to be made.
A rise and daily close above the March 2024 peak at $73,757.39 would probably put the April 2025 low at $74,441 on the map. If also exceeded, the March 2025 low at $76,702.93 could be reached as well.
Bitcoin bearish case:
While Bitcoin stays below its March 2024 high at $73,757.39 on a daily chart closing basis, the psychological $60,000 region may be revisited. Below it lies another support zone at $59,635.83 – $56,148.93 which is made up of several weekly lows seen between March and September 2024.
Short-term outlook:
Neutral while below the March 2024 high at $73,757.39 but above last week’s $65,107.17 low.
Medium-term outlook:
Neutral with a bearish bias while below the March 2024 high at $73,757.39 but above the $56,148.93 mid-August 2024 low; failure there might engage the $50,000 region and the August 2024 low at $49,217.00.