Bitcoin is exhibiting initial signs of recovery, trading above crucial demand levels after experiencing weeks of significant selling pressure and increasing macroeconomic uncertainties. Following a fall of over 29% from its all-time high of $109,000 in January, BTC has rebounded by more than 7% from its recent low of $81,000 recorded last Tuesday. This upward movement has generated a sense of cautious optimism among traders, although analysts remain split on what Bitcoin’s next steps might be.
Some experts speculate that this recent surge could be fleeting and signal the onset of a lengthy bear market. Conversely, others contend that Bitcoin’s long-term fundamentals continue to be robust, and a bullish continuation is still feasible. A promising indicator comes from institutional trading: for the fourth consecutive session, the net inflow of USD into US Spot Bitcoin ETFs has remained positive.
This steady influx indicates sustained interest from institutional players despite market volatility. As these inflows bolster Bitcoin’s on-chain demand, bullish traders could acquire the momentum required to drive prices back toward significant resistance levels.
Despite the ongoing uncertainty that looms over wider financial markets—sparked by inflation concerns, interest rate speculation, and geopolitical strife—Bitcoin seems to be at a pivotal point where demand from ETFs could significantly influence its forthcoming major movements.
ETF Inflows Indicate Renewed Institutional Confidence Amidst Market Turbulence
Bitcoin is currently trading above essential support levels, although bullish traders still need to solidify a comprehensive recovery. Since late January, global markets have faced pressure due to escalating trade war tensions and unpredictable actions by U.S. President Trump, including contentious tariff strategies and foreign policy changes. These factors have introduced volatility across various risk assets, including both cryptocurrencies and equities, dampening expectations for a robust bull market in 2025.
As fears of a recession loom and discussions of a broader bear market continue, some analysts believe that Bitcoin’s long-term trajectory could remain intact. A positive sign is emerging from the realm of institutional demand.
Renowned analyst Axel Adler shared on-chain data via X, illustrating that net USD inflows into U.S. Spot Bitcoin ETFs have stayed positive for the fourth consecutive trading session, with a total of $632 million added to these ETFs during this timeframe, indicating renewed confidence among institutions.
These consistent inflows, even amidst market uncertainty, hint at strong buying momentum at current price levels. If this pattern persists, it could lay the groundwork for a more substantial price recovery. For the moment, Bitcoin remains in a delicate position. Bulls are tasked with driving prices above $88,000 and reclaiming the $90,000 mark to establish momentum. Should ETF demand persist, it could provide the necessary spark for a more robust upward move.
BTC Price Stabilizes at Critical Level as Bulls Pursue $88K Reclaim
Bitcoin is currently trading around $85,500, situated near two significant technical indicators—the 200-day moving average (MA) and the exponential moving average (EMA). This area has evolved into a crucial battleground between buyers and sellers as BTC seeks to stabilize following weeks of downward pressure. Bulls must defend this support level vigorously to avert a further decline into lower demand zones.
To validate a recovery rally, BTC must surpass the $88,000 threshold, which would not only reclaim recent losses but also break through short-term resistance levels and restore market confidence. A sustained movement above this mark could likely incite renewed momentum, potentially targeting the $90,000 region and beyond.
However, the risk of a downside break remains considerable. If Bitcoin fails to maintain the $85,000 support and drops below the 200-day MA and EMA, selling pressure could escalate quickly. In such a case, a decline below $80,000 would be highly probable, potentially testing deeper support levels and escalating market fears.
In the short term, Bitcoin’s trajectory hinges on reclaiming $88,000 and staying above $85,500. Any failure to achieve this could pave the way for another round of downward volatility.
Featured image from Dall-E, chart from TradingView
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