Signs of a Short-Term Bottom
Bitcoin may be carving out a short-term bottom after weeks of heavy selling, with market conditions now in place for a potential relief rally toward the $100,000 to $110,000 range. Trader Mister Crypto outlined the case in a recent video analysis.
The short-term structure shows signs of stabilization following what the analyst described as capitulation across the market. Indicators tied to trader behavior suggest large players have begun opening new long positions despite sentiment plunging into Extreme Fear territory, a mix that has historically preceded bounces during downturns.
Technical Indicators Signaling a Rebound
The Bitcoin Relative Strength Index on the weekly chart is approaching the 30 level, one of the main technical signals cited. "We have bottomed out for Bitcoin right here. We have been reaching the 30 level. Boom," Mister Crypto stated in the video.
In past cycles, this zone has coincided closely with market bottoms, the analyst noted. While cautioning that this does not guarantee the start of a new bull run, the current setup often signals at least a temporary reversal.
Bitcoin's distance from the 50-week moving average, currently near $102,000, adds weight to the rebound scenario. Bitcoin has repeatedly retraced toward this level after dipping below it in previous market cycles, with expectations now pointing to a bounce that could lift prices back into six figures.
Macroeconomic Factors Supporting Optimism
Macro conditions are also feeding near-term optimism. The analyst pointed to expectations that quantitative tightening could soon end, combined with speculation around another interest rate cut at an upcoming policy meeting. Both developments tend to favor risk assets such as Bitcoin by easing financial conditions.
Cautious Longer-Term Outlook and Shifting Sentiment
The longer-term outlook remains cautious, however. The analyst claimed the broader market is in bear territory and warned that any bounce could be followed by renewed weakness later on, as broader conditions have yet to show a decisive shift back into sustained growth.
After spending 18 days in Extreme Fear, the Crypto Fear & Greed Index finally lifted to a Fear level of 28. Meanwhile, Bitwise Europe research head André Dragosch said Bitcoin could have major upside ahead, as its current price doesn't reflect improving macro expectations.
Dragosch argued Bitcoin now offers an asymmetric risk-reward similar to the COVID crash of March 2020, when prices plunged before rebounding strongly. He said the market is already pricing in an extremely bleak global outlook.