Bitcoin The rebound after last week’s sell-off is already hitting a wall.
After briefly slipping into the $60,000 mark during a capitulation move last week, the largest cryptocurrency returned to the $70,000 level over the weekend, but momentum has since faded.
This stall causes traders to reframe the rebound as a classic bear market pattern, a sharp relief rally that attracts buyers on the dip, only to be met with a wave of supply from investors looking to exit at better prices.
“There is still a huge supply in the markets from those who want to abandon the top cryptocurrency during the rebound,” said Alex Kuptsikevich, chief market analyst at FxPro, in an email. “Under such conditions, it is worth preparing for a retest of the 200-week moving average in the near future.”
“We remain very skeptical about the near future, as the recovery momentum lost steam over the weekend, encountering a sell-off near the $2.4 billion level. Perhaps we have only seen a downward rebound, which is not yet complete,” he added.
The sentiment data paints a similarly fragile picture. The Crypto Fear and Greed Index fell to 6 over the weekend to reach the same levels as an FTX-driven downturn in 2022, before returning to 14 on Monday evening.
Kuptsikevich said those numbers remain “too low levels for confident buying,” arguing that the change reflects more than passing nervousness.
Liquidity conditions add to the unease. With smaller order books, light selling pressure can produce outsized moves, which then trigger additional stop-outs and liquidations, a feedback loop that makes price action appear disordered.
This dynamic, rather than a single stock, may explain why Bitcoin can swing thousands of dollars in a session but still fail to break key resistance.
A Kaiko note published Monday described the context as a broader decline in risk aversion. It said overall trading volumes on major centralized exchanges have declined by about 30% since October and November, with monthly spot volumes falling from about $1 trillion to $700 billion.
The company said that while last week saw some strong surges in trading, the overall trend has been a steady decline in participation. This indicates that traders, particularly retail investors, are gradually exiting the market rather than being forced out all at once.
When liquidity dwindles like this, prices can fall quickly under relatively modest selling pressure, without the kind of large, panic-induced volume that typically signals clear capitulation and a durable bottom.
Kaiko also framed this decision within the familiar logic of the four-year halving cycle. Bitcoin peaked around $126,000 in late 2025/early 2026 and has since retraced sharply, with the pullback to the $60,000-$70,000 area representing a roughly 50% decline from the highs.
Historically, these dips can take months to develop and often feature several failed rallies.
For now, Bitcoin’s ability to hold the $60,000 zone is key. If buyers continue to defend it, the market could settle into unstable consolidation. Otherwise, the same dynamic of liquidity scarcity that fueled the collapse could quickly return, especially if overall macroeconomic conditions remain risk-averse.
