Bitcoin gains strength after breaking above the $70,000 level, a move that helped restore bullish sentiment after weeks of heightened volatility. The recovery comes after a turbulent period for global markets, during which geopolitical developments and macro uncertainty led to sharp price swings in risk assets.
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According to the latest CryptoQuant report by XWIN Research Japan, Bitcoin experienced significant volatility between late January and early March 2026. During this period, the asset briefly fell to around $60,000, before a sharp increase in early March that brought prices back to around $73,000.
The report notes that the initial decline was largely driven by geopolitical developments. On February 28, reports of a US-Israeli military attack on Iran raised tensions across the Middle East and introduced significant uncertainty into global markets. As risk sentiment worsened, Bitcoin quickly fell to around $63,000 on February 29.
However, sales proved short-lived. Market conditions stabilized within a few days, and by March 2 Bitcoin had already recovered to a level of around $70,000.
The opportunity picked up shortly after as renewed buying pressure pushed BTC above $73,000 between March 4 and March 5, signaling a potential short-term shift in sentiment as investors reassess the broader market environment.
ETF Inflows and Bitcoin Short Fuel Returns
The CryptoQuant report further explains that re-entry into Bitcoin ETFs has played a major role in driving the recent rally. In early March, several hundred million dollars flowed into these investment vehicles, providing direct support to market demand. Only on March 4, ETF inflows exceeded 200 million dollars, reflecting the revival of institutional participation after a period of slower activity.
Derivatives markets also contributed significantly to this rally. Open interest increased sharply while funding rates moved into negative territory, indicating that many traders were aggressively short-sided. As the price of Bitcoin began to rise, these crowded short positions were forced to create short liquidation waves that increased the upward momentum through short closing.
Chain markers provide a more nuanced view. The report notes that some bearish signals remain, including a 90-day realized P/L ratio of 1.0 and a growing share of coins currently holding unexpected losses. At the same time, constructive progress is being made underground.
One example is the Coinbase Premium Index, which recently returned to positive territory after a long period of negative readings. This change indicates that demand from American investors is starting to recover.
The move to $73,000 appears to be largely due to a combination of ETF gains and short coverage in derivatives.
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Bitcoin breaks through key resistance as momentum strengthens
The chart shows Bitcoin trading after a strong upward move that pushed the price firmly above the $70,000 level. The break comes after several weeks of consolidation around $64,000 and $69,000, where the market has repeatedly tested both support and resistance without finding a clear direction.
From a technical perspective, the recent rally has allowed Bitcoin to recover its short-term moving averages, including the 50-period and 100-period lines, which previously acted as resistance during the consolidation phase. A break above these levels would indicate a short-term momentum reversal as buyers regain control of the market.
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The price is now nearing the 200-period moving average, which is slightly above the current level and is the main technical barrier near the $74,000 area. This level can act as the next resistance zone, as long-term participants often use it as a reference to confirm the trend.
Volume also increased during the break, indicating stronger participation as the market rose. The sharp up candlesticks reflect the aggressive buying pressure seen with the short-term dynamics in derivatives markets.
If Bitcoin manages to consolidate above $70,000, a breakout could establish this level as a new support zone. However, failure to hold this structure could lead to another test of the $68,000-$69,000 area before attempting a new directional market move.
Featured image from ChatGPT, chart from TradingView.com
