Bitcoin Jumps 4.4% in Short Squeeze but $70K Test Looms

The Big Three

01Session Data

02Key Movers

03Market Commentary

Bitcoin staged its sharpest single-session recovery in three weeks on Tuesday, surging from a 24-hour low of $64,934 to a high of $69,983 before settling near $68,156 on the Bitstamp daily close. The move was driven by a violent short squeeze — over $323 million in leveraged positions were liquidated across major exchanges within 24 hours, creating a feedback loop that accelerated the rally. BTC perpetual volume on Bybit alone hit $4.76 billion, signalling elevated speculative activity.

The macro backdrop provided a tailwind. President Trump’s State of the Union address highlighted cooling inflation and record-low mortgage rates, boosting risk appetite across equities and spilling into crypto. The S&P 500 rose 0.81% and the Nasdaq gained 1.26%. More importantly for crypto-specific flows, U.S. spot Bitcoin ETFs recorded net inflows of $257.7 million on Tuesday (Feb 24) — the highest single-day intake since early February and a reversal of the persistent outflow trend that has defined the drawdown.

Altcoins outperformed Bitcoin by a wide margin, a classic feature of relief rallies in heavily oversold markets. Polkadot led majors with a 24.9% surge, followed by NEAR (+14.2%), Cardano (+10.2%), and Ethereum (+8.5%). ETH’s reclaim of the $2,000 level is symbolically important — it had traded below that threshold since February 19. Meme coins participated too, with DOGE up 7.6% and SUI up 8.6%. The broad-based nature of the rally suggests genuine risk-on rotation rather than a BTC-only squeeze.

Still, the structural damage from the 52% drawdown since October’s $126,272 ATH remains the dominant backdrop. VanEck’s research team characterized the selloff as “orderly deleveraging, not capitulation,” noting that futures open interest has fallen 45% from peak — but cautioned that no classic capitulation event has occurred. Strategy (formerly MicroStrategy) reported a staggering $12.4 billion Q4 loss driven by Bitcoin impairment charges, and spot ETFs have seen cumulative outflows of roughly $3.8 billion over five consecutive weeks through February 23. The Fear & Greed Index at 14 marks the deepest Extreme Fear reading since the 2022 FTX collapse.

04Technical Analysis

Daily (1D):

The daily chart shows Bitcoin attempting to stabilize within a tight consolidation range between $66,867 and $71,075 after the February freefall. The close at $68,156 sits squarely in the middle of this band. Price remains deeply below the 200-day SMA at $97,903 — a staggering 30.4% discount that underscores the magnitude of the bear trend. The Ichimoku cloud is far overhead, with the lower cloud boundary near $79,192 acting as the first structural resistance. Price is decisively below the cloud, confirming the bearish macro posture.

Momentum indicators are showing early signs of stabilization. The RSI reads 42.96 (fast) and 36.25 (slow), recovering from deeply oversold territory in the low 30s but still well below the 50 neutral line — indicating bearish momentum persists even as the worst of the selling pressure may be easing. The MACD lines at −3,203/−3,916 remain deeply negative, but critically, the histogram has turned positive at 714 for the first time in several weeks, signalling that downside momentum is decelerating. This is not yet a buy signal but suggests the velocity of the decline is exhausting itself.

Forex.com’s senior technical strategist identifies $70,238 as the key inflection point — a close above would keep the near-term focus higher, while rallies need to remain below $76,159 for the broader October downtrend to stay intact. On the downside, a close below $62,795 would fuel the next leg of the decline. The Bollinger Bands are beginning to contract after weeks of expansion, suggesting the high-volatility phase may be transitioning into a range-bound consolidation.

05Forward Look

$70K: The Line in the Sand.

The 24-hour high at $69,983 put Bitcoin within touching distance of the $70,000 psychological level that multiple analysts identify as the key inflection. A sustained daily close above $70K would shift the near-term narrative from dead-cat bounce to genuine recovery and could attract momentum-chasing flows. Failure to break through would keep the head-and-shoulders pattern intact with a downside target of ~$56,000.

Nvidia Earnings and Risk Sentiment.

Nvidia’s after-hours results will ripple through crypto given the persistent correlation between AI-adjacent tech and risk assets. A strong print could support the nascent recovery; a miss could re-ignite the AI-disruption narrative that has been pressuring leveraged risk assets including Bitcoin throughout February.

ETF Flow Sustainability and Fed Path.

Tuesday’s $257.7 million in spot ETF inflows was encouraging but needs confirmation. The five weeks through February 23 saw ~$3.8 billion in cumulative outflows, and a single day’s reversal does not constitute a trend. The Fed rate path — currently pricing three cuts for 2026 under incoming Chair Kevin Warsh — remains the dominant macro variable for crypto’s medium-term trajectory. JPMorgan maintains a long-term bullish Bitcoin outlook; the question is whether this cycle’s floor is $55K or $65K.

Verdict

Tuesday’s 4.4% surge was the loudest signal in weeks that the selling momentum is exhausting itself. The short squeeze, combined with the first meaningful ETF inflow day since early February, suggests that institutional “smart money” is beginning to probe the long side again even as retail sentiment remains frozen in Extreme Fear at 14.

But this is a bounce within a bear trend, not the start of a new bull cycle. Bitcoin is 30% below its 200-day SMA, the MACD remains deeply negative, and the Ichimoku cloud overhead at $79K represents a wall of resistance that will take weeks of accumulation to challenge. VanEck’s characterization of “orderly deleveraging” is accurate — the panic phase appears to be behind us, but the rebuilding phase has barely begun. Futures open interest is down 45% from peak, meaning the leverage-driven overshoot on both sides has been wrung out.

The $70K level is now the binary test. A sustained close above it opens a path toward $76K and the October downtrend line. Failure at $70K, especially on declining volume, would confirm the bearish head-and-shoulders pattern and reopen the door to a retest of the $62,500 February low — with VanEck’s realized price support near $55,000 as the ultimate backstop.

Bias: BEARISH · relief rally within broader downtrend, $70K is the inflection — prove it or lose it