Bitcoin Rebounds From Weekend Sell-Off... The Bloodbath Hasn't Even Begun?

▲Bitcoin Plunge Shock/ChatGPT-generated image ©

Bitcoin (BTC), which slipped below $65,000 over the weekend, managed to stage a rebound, but analysts warn that a truly definitive bottom may still be a long way off. With institutional capital continuing to flow out and key on-chain indicators showing room for further decline, Nvidia’s performance and geopolitical tensions in the Middle East have emerged as the biggest variables that could determine the market’s next direction.

According to investment outlet FXStreet on February 23 (local time), Bitcoin briefly fell below the $65,000 level during the thin-liquidity weekend session but quickly found buying support. However, the current price movement appears more like a three-week consolidation phase following January’s sharp plunge. The absence of extreme panic selling that typically signals capitulation suggests it is too early to conclude that a full bottom has been formed.

Amid cautious investor sentiment, the U.S. spot Bitcoin ETF market has recorded large-scale outflows for five consecutive weeks. While gold, a traditional safe-haven asset, has been regaining strength, Bitcoin has struggled, accelerating the withdrawal of short-term momentum-driven capital.

Adding to concerns is the Market Value to Realized Value (MVRV) Z-score, an on-chain metric that has yet to enter bottom territory. In previous major downturns, the indicator fell to zero or negative levels, signaling true market bottoms. Currently, however, there remains further downside room, raising the risk of another sharp price drop.

Market focus is now shifting beyond U.S. President Donald Trump’s tariff policies to Nvidia’s earnings report and geopolitical tensions between the United States and Iran. Experts note that tariffs have had only a limited impact on the crypto market, while the potential resumption of U.S.-Iran dialogue and whether Nvidia can revive risk appetite across technology stocks are seen as more decisive factors.

Still, if positive momentum driven by Nvidia is confined to tech stocks alone, the cryptocurrency market could be sidelined as investor attention shifts elsewhere. For a genuine rally to take shape, analysts suggest the market may first need to experience another significant shakeout marked by extreme selling pressure to flush out excess froth.

Disclaimer: This article is provided for investment reference only, and no responsibility is taken for investment losses based on its content. The information herein should be interpreted solely for informational purposes.