Bitcoin regained $65,400 early Wednesday as a weaker US dollar and a risk-on tone across Asian stocks gave crypto markets their first clean bounce in weeks.
The broader crypto market capitalization had fallen to $2.19 trillion earlier in the week, virtually retesting the lows hit during the February 5 crash. That closeness is what makes the current move interesting.
If the level holds, the market is looking at a textbook “double bottom” with about 10% upside, according to Alex Kuptsikevich, chief market analyst at FxPro. If it doesn’t, he warned, “a failure to rebound will signal the end of the recovery, opening the potential for a further 25% decline.”
A double bottom is a classic bullish chart pattern that signals a potential trend reversal after a downtrend. Imagine that the price drops to a low, then bounces up a bit, forms resistance, and then falls back to test the same low. This creates a W-shaped structure with two “bottoms”. When the price breaks above the middle top, a bullish reversal is confirmed.
The focus is therefore on whether the ongoing recovery rally extends beyond the brief jump to $2.47 trillion market cap seen about 10 days ago.
Altcoins rise when the dollar falls
Meanwhile, major tokens are tracking bitcoin higher. Ether gained 4.2% over the last day, solana gained 7% and XRP added 3%. The moves came as MSCI’s gauge of Asian shares rose 1.4% to a record, led by South Korea and Taiwan, with AI-linked chip makers hitting all-time highs ahead of Nvidia’s earnings report later Wednesday.
The dollar gave a tailwind to risk assets. The Bloomberg Dollar Spot Index fell after President Trump’s State of the Union address, in which he doubled down on tariff plans despite the Supreme Court striking down his global import tariffs.
He further suggested that tariffs could eventually replace the income tax system altogether.
A weaker dollar has historically been constructive for bitcoin, although the relationship has been inconsistent during this drawdown cycle.
But the conviction is still thin despite the rejection. Bloomberg reported that analysts it surveyed described a “crisis of confidence” in bitcoin after its nearly 50% drop from all-time highs, with no obvious new catalysts for growth.
FxPro’s Kuptsikevich went further, saying the market likely hasn’t bottomed out yet and that “real capitulation is still ahead.”
