- The price of Bitcoin (BTC/USD) has experienced notable fluctuations, dipping to $78k before surging to $95,000 following comments from Trump about a cryptocurrency reserve, ultimately stabilizing around $86k.
- Currently, open interest for Bitcoin is at its lowest level in six months, which historically has indicated potential price increases.
- On the final day of February, spot Bitcoin ETF inflows recorded an investment of $94.3 million, ending a period of substantial withdrawals. Will this trend continue?
- Technical analysis suggests that BTC/USD may be facing a downtrend.
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Bitcoin’s volatile journey continued today, with the cryptocurrency witnessing an approximately 18% rise from Friday’s low. However, these gains were short-lived, as Bitcoin retreated to around $86k at the time of writing.
Crypto Heatmap, March 3, 2025
Source: TradingView (click to enlarge)
Trump and the Cryptocurrency Reserve
Upon U.S. President Donald Trump’s announcement on March 2 about a strategic cryptocurrency reserve, Bitcoin’s price saw a spike of 11%, reaching nearly $95,000.
Initially, he listed XRP, Solana, and Cardano as part of this reserve, but subsequently updated his statement on Truth Social to include Bitcoin, Ether, and additional cryptocurrencies.
This surge followed a 2% increase on March 1 and a price recovery on February 28 from a low of $78,197, ending the day nearly flat at $84,321.
While Trump’s announcement provided a boost to the crypto market, significant factors such as tariffs continue to weigh heavily on traders’ minds. The broader economic context remains a key influence, evident in current price movements amid ongoing tariff uncertainties and geopolitical tensions.
Concerns have been raised regarding President Trump’s proposed reserve, with legal expert James “MetaLawMan” Murphy stating that establishing a strategic digital asset reserve may not be feasible through executive order.
Murphy further noted on X that even if Congress were to swiftly approve the reserve—a scenario deemed unlikely—the crucial factor would be its funding. The initial approach may involve halting government sales of crypto assets, which he argues would have a minimal impact on market prices.
In the near term, the critical question remains whether Friday’s low of approximately $78k will serve as a support level for a rebound toward $100k or if it will break under pressure as market sentiment leans cautious.
ETF Inflows
On the last day of February, U.S. spot Bitcoin ETFs saw an inflow of $94.3 million, concluding a challenging month for crypto—the toughest in three years.
This marks the end of a period characterized by eight consecutive days of withdrawals, during which investors withdrew over $3.2 billion from these funds as crypto prices declined.
The upcoming week is critical for ETF flows, as it will be compelling to observe whether these inflows continue to improve following Trump’s comments on the cryptocurrency reserve over the weekend.
Source: Farside Investors (click to enlarge)
Positive Outlook from Bitcoin’s Open Interest
CrediBULL Crypto shared on X that Bitcoin’s open interest has fallen to its lowest level in six months. He noted that previously, when it was at this level, Bitcoin’s price ranged between $50,000 and $60,000. He further stated that Bitcoin’s funding rate has turned negative, mirroring the conditions before its price surged to $100,000 in that range.
He remarked that these indicators look “fantastic” for Bitcoin, supporting his view that it may have reached a bottom. This sentiment aligns with Bitcoin’s rebound to $95,000 after dipping below $80,000 last week.
Source: ‘CrediBULL Crypto’ on X (click to enlarge)
BTC/USD Technical Analysis
From a technical perspective, Bitcoin (BTC/USD) remains in a downtrend on the daily chart despite the recent weekend surge.
The failure of the daily candle to close above the 96,572 mark indicates that BTC/USD could be susceptible to additional downside movement.
A death cross formation has also emerged, as the 50-day moving average (MA) crosses below the 100-day MA, typically indicating further downward potential.
Bitcoin (BTC/USD) Daily Chart, March 3, 2025
Source: TradingView.com (click to enlarge)
Examining a two-hour chart, an inverse head and shoulders pattern formed last week, with a breakout happening over the weekend, has played out successfully.
The target was set around the 95,000 mark, which was achieved prior to a notable pullback on Monday.
The concerning aspect is that the bullish momentum has not only faded but the price closed below the previous swing low at 85,600, suggesting a structural shift favoring bearish sentiment.
Additionally, the 50 and 100-day MAs will act as considerable barriers should bulls attempt to recover.
Immediate resistance is identified at 86,567 and 88,096, before the 90,000 level comes back into focus.
Immediate support stands at 85,000, with further levels at 83,500 and 80,000 looming.
Bitcoin (BTC/USD) Two-Hour (H2) Chart, March 3, 2025
Source: TradingView.com (click to enlarge)
Support
Resistance
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