After a gut-wrenching 48 hours for Bitcoin investors that saw the price of BTC briefly dip below $100,000 for the first time since May, cryptocurrency markets are now showing signs of life once again.
The more than $2 billion in total crypto liquidations during yesterday’s flash crash, mostly from long positions, represents one of the largest flush-outs of leveraged positions this year.
This event seems to have marked at least a temporary bottom, clearing out skittish investors and overleveraged traders. Crypto’s total market capitalization has since bounced back to $3.5 trillion, posting a solid 3.5% gain in the past 24 hours. according to CoinGecko.
Traditional markets are providing a mixed backdrop for the crypto rebound. The S&P 500 gained 0.7% on Wednesday after Tuesday’s selloff, with the Nasdaq Composite advancing 0.9% as AI stocks rebounded from valuation concerns. However, the ongoing U.S. government shutdown—now the longest in American history at 31 days—continues to create uncertainty around economic data releases and policy decisions.
Despite the doom and gloom on social media, and even some analysts who are slashing their price targets, Bitcoin sentiment has turned at least marginally bullish on Myriad, a prediction market built by Decrypt’s parent company Dastan. At the moment, Myriad users say there’s a 67% chance Bitcoin returns to $115K instead of bleeding all the way down to $85,000.
Are the predictors right, or is there a little too much copium in the air? Here’s what the charts say.
Bitcoin is currently trading at $103,824, having recovered from Tuesday’s plunge below $100,000—the first time the flagship cryptocurrency breached that level since May. The 24-hour price action shows resilience, though volume remains elevated as traders appear cautious about declaring the all-clear.
The technical picture shows bearish exhaustion, but not enough for a bullish breakout just yet.
The Relative Strength Index, or RSI, for Bitcoin is at 38 points, which sits in oversold territory. RSI measures market momentum on a scale from 0 to 100, where readings below 30 signal oversold conditions and over 70 suggest overbought.
At 38, Bitcoin’s RSI indicates selling pressure is waning, and bargain hunters typically start building positions at these levels. However, the Average Directional Index, or ADX, is only at 20.33, which barely suggests any trend exists at all. ADX measures trend strength: above 25 means strong trend, below 20 signals choppy, directionless action. Bitcoin’s weak reading means the market lacks conviction.
