After falling near weekly lows around $65,000, Bitcoin price managed to recover a notable chunk of the previous day's losses even as global economic slowdown rattled stock markets.

The total crypto market cap reclaimed footing above $2.4 trillion after rallying over roughly 3%, supported by Bitcoin's late-day recovery.

Sentiment edged higher today, with the Crypto Fear and Greed Index rising four points to 21.

This slight recovery nudges the market out of extreme fear as investors begin to digest Bitcoin’s latest price action.

Altcoins remained relatively suppressed over the vast majority of Asian trading hours, but multiple high-cap assets managed to move into the green as crypto markets reacted to Bitcoin’s quick recovery.

Specifically, Ethereum reclaimed the $2,000 psychological level, while Solana and BNB posted modest gains of 2% to 4%, indicating a broader, albeit cautious, return of risk appetite.

The cryptocurrency market witnessed a dramatic V-shaped recovery today as Bitcoin plummeted to an intraday low of $65,000 before staging a resilient comeback to trade above $69,000.

Energy market volatility served as the primary catalyst for the early morning slide.

Brent crude oil prices surged toward $118 per barrel, marking their highest levels since 2022, as the ongoing conflict involving Iran threatened to disrupt critical supply routes in the Strait of Hormuz.

This sudden spike in energy costs reignited fears of sticky inflation in the US, leading market participants to reassess the likelihood of short-term interest rate cuts by the Federal Reserve.

Broader equity markets mirrored this risk-off sentiment, with Asian indices like the Kospi suffering significant losses.

Bitcoin, often trading as a high-beta risk asset in times of uncertainty, faced additional pressure from a strengthening US dollar and rising Treasury yields.

The combination of geopolitical instability and a hawkish shift in monetary expectations triggered a wave of liquidations, forcing the price down to the psychological $65,000 floor.

Institutional outflows also contributed to the bearish momentum seen over the weekend and into the early hours of Monday.

Recent data indicated a cooling of demand for spot Bitcoin ETFs, with net outflows suggesting that some large-scale investors chose to move to the sidelines ahead of upcoming Consumer Price Index data.

This lack of immediate buy-side support allowed the price to drift lower as sell orders outpaced new capital entry.

The narrative shifted during the afternoon trading session as buyers stepped in to defend the $65,000 support zone.

Analysts noted that the initial sell-off may have been overextended, leading to a relief rally as traders realized that the structural integrity of the network remained unaffected by the macro chaos.

Furthermore, rumors of a coordinated strategic oil reserve release by G7 nations helped to temporarily cap the rally in crude prices, providing a slight reprieve for risk-sensitive assets.

Short-sellers who had bet on a deeper collapse toward $60,000 were caught off guard as the rebound accelerated.

This resulted in a minor short squeeze where participants were forced to buy back Bitcoin to cover their positions, adding further fuel to the upward move.

By the time the US markets opened, the digital currency had already reclaimed the $68,000 level, showing a decoupling from the persistent weakness in traditional tech stocks.

Meanwhile, even though the spot Bitcoin ETFs experienced significant volatility toward the end of last week, the downside has shown signs of improvement as the period marked the second consecutive week of net inflows in five weeks.

At the time of writing, Bitcoin sits firmly above $69,000, having wiped out most of its intraday losses.

While the recovery is a positive sign for bulls, the market remains on high alert.

The upcoming inflation reports and the potential for further military escalation in the Middle East mean that volatility is likely to remain a constant companion for crypto traders throughout the week.

Market analysts suggest that the $70,000 to $74,000 range acts as the next major resistance cluster. See below.

For a sustained bullish reversal to take hold, Bitcoin will need to close decisively above these levels.

According to a chart from analyst Satoshi Flipper, Bitcoin has also confirmed an LTF breakout on the 2-hour chart.

Typically, when this happens, price momentum tends to build in the direction of the breakout as traders reposition for a potential continuation move.

BTC/USDT 2-hour price chart. Source: Satoshi Flipper.

In the long term, fellow trader and analyst Crypto Fergani pointed to Bitcoin’s monthly chart, which appears to show a large cup and handle formation developing over the past several years.

According to the analyst, this type of pattern has historically preceded strong continuation moves when confirmed. 

The chart also highlights multiple bullish crossovers on the Stochastic RSI indicator, signals that in previous cycles have coincided with the early stages of major upside expansions.

Bitcoin 1-month price chart. Source: Crypto Fergani.

At press time, Bitcoin price was hovering just over $69,000, up over 3% in the past 24 hours.

The post Bitcoin rebounds to $69K in V-shaped recovery after hitting weekly lows appeared first on Invezz

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