Bitcoin rebound stalls near $71K as sentiment hits 2022 lows
Bitcoin’s recovery from a plunge into the low-$60,000s has stalled near $70,000–$71,000, prompting traders to treat the move as a bear-market relief rally rather than a new uptrend. Analysts cite heavy overhead supply, fragile sentiment (Fear & Greed Index falling to 6 over the weekend, later 14), and thin liquidity as key risks. Kaiko data show spot trading volumes on major centralized exchanges have fallen roughly 30% since late 2025, from about $1 trillion monthly to around $700 billion, indicating fading retail participation. Traders warn that thin order books can amplify modest selling into large price swings and may lead to another test of long-term support around the 200-week moving average (~$60,000). Within the four-year halving cycle context, the decline from a peak near $126,000 represents a greater-than-50% drawdown; historical bottoms after similar retracements often take months and feature multiple failed rallies. Key takeaways for traders: watch the $60,000 support/200-week MA, monitor liquidity and spot volumes, and treat the current bounce with caution until sustained buying and volume confirm a trend reversal.
Bearish
The article highlights multiple risk factors that point to a bearish near-term outlook. Key reasons: 1) The rebound stalled at resistance near $70–71K and is being interpreted as a relief rally, not a trend reversal. 2) Sentiment is extremely weak (Fear & Greed Index at levels similar to the 2022 FTX downturn), reducing confidence among retail buyers. 3) Liquidity has thinned substantially — Kaiko reports ~30% drop in spot volumes since late 2025 — which makes the market vulnerable to outsized moves from modest selling. 4) Heavy overhead supply and the prospect of another test of the 200-week moving average (~$60K) create clear downside targets. Historical parallels: after major peaks in halving cycles, >50% drawdowns have produced prolonged bottoms with multiple failed rallies (e.g., post-2017 top and 2021 peak patterns). For traders, this suggests higher short-term downside risk and volatile chop; strategies should prioritize risk management (tight stops, position sizing) and wait for confirmatory signals — sustained higher volumes and reclaimed support levels — before taking sizable long positions. Longer-term outlook remains conditional: if $60K/200-week MA holds and liquidity/participation recover, the medium-to-long-term bullish thesis tied to the halving cycle could reassert, but only after a clearer capitulation or rebuild of demand.