Bitcoin’s sudden crash shocked investors, only to be followed by a powerful rebound. Is this just a temporary bounce or the beginning of a major rally? On-chain and technical data hint at what’s coming next.
It was one of the most contradictory market movements of February and one of the most sudden reversals of March: the relative collapse of BTC, driven by a sell-off mirroring that of the stock market, followed by a surprising and abrupt recovery in early March.
These two distinct market moves warrant a closer analysis, particularly to address a crucial question: is this merely a classic "dead cat" bounce, or is there reason to expect BTC to reach new all-time highs in the near future?
Bitcoin’s Worst Crash Since 2022
The February sell-off was severe—the worst since June 2022, marking a downturn reminiscent of the previous bear market.
For many investors, after years of steady gains, it was a stark reminder of what it means to hold a crypto portfolio deep in the red. The most fitting word to describe this crash is "unexpected." Once the 90,000 support level was breached, fear took over, and several technical indicators started signaling the possibility of another bear market.
What Triggered the BTCUSD Rebound?
Officially, the catalyst for Bitcoin’s rebound appears to have been Donald Trump’s announcement regarding his intention to establish a strategic reserve that could potentially include crypto assets. In a post on Truth Social, the former president mentioned that BTC and ETH, along with other cryptos, could be considered as part of this reserve, reaffirming his "love" for these digital assets.
However, this remains speculation—news that merely serves as a narrative for Bitcoin’s price movement. To truly understand what’s driving the price action and where it may head next, we must analyze the on-chain data.
During the February downturn, on-chain metrics showed a notable divergence, evoking the concept of a "bear trap." While prices were plunging, long positions—many on margin—were actually increasing. Data from CoinGlass reveals a significant clustering of margin calls around the 80,000 level.
This suggests that a substantial transfer of positions occurred between retail traders and large institutional players (the so-called "whales"). While painful for small investors, such accumulation is often a bullish signal. Additionally, The Block’s "Crypto Monthly Exchange Volume" report supports this thesis, showing that trading activity on exchanges remained at multi-year highs. This underscores heightened market participation and suggests that volatility is likely to remain elevated in the coming days.
Technical Analysis: Signs of a New Uptrend?
From a technical perspective, Bitcoin’s price action has been particularly noteworthy. After its sharp recovery above $90,000, the RSI on the daily timeframe climbed from "oversold" territory back to a neutral zone around 50 points. This suggests the potential for a renewed uptrend, which could propel prices toward the higher end of the indicator’s range.
A critical support level for this new trend remains $90,000, a price point whose breakdown triggered February’s crash and thus carries significant trading volume weight. Bitcoin’s strong rebound after briefly touching the 80,000 level—an area of heavy long liquidation—reinforces the idea of a bear trap. This further supports the notion that, despite the sharp and violent correction, the broader trend remains firmly bullish.
Original article published on Money.it Italy 2025-03-03 13:08:54. Original title: La rinascita di Bitcoin. Quando toccherà i nuovi massimi storici?
