Key Takeaways

  • Bitcoin recovered to approximately $68,000 following a weekend decline to $63,000
  • Spot Bitcoin ETFs attracted $1.45 billion in net inflows across five consecutive trading sessions
  • Short-covering activity fueled much of the price recovery rather than new buying momentum
  • The RSI indicator increased from 36 to 41, while daily trading volume expanded from $6.6B to $9.6B
  • Prediction markets indicate reduced probability of BTC reaching $65K or $60K during March

Bitcoin’s valuation rebounded toward the $70,000 level on March 4, reaching approximately $68,000 during Hong Kong trading hours.

Bitcoin (BTC) Price
Bitcoin (BTC) Price

This recovery came after a weekend selloff brought BTC down to the $63,000 range, with escalating Middle East tensions serving as the catalyst.

According to market maker Enflux, short-covering activity represented the primary force behind the bounce. Bearish traders who had opened short positions were compelled to close them as anticipated regional conflict failed to materialize immediately.

“The market is not pricing catastrophe, but it is not pricing resolution either,” Enflux wrote in a note to CoinDesk.

Cryptocurrency markets typically respond to geopolitical developments more rapidly than conventional financial markets. Enflux characterized Bitcoin as serving a “pressure valve” function for capital during periods of heightened uncertainty.

Spot ETF Demand Supports Price Action

Institutional accumulation has emerged as a critical support mechanism for Bitcoin’s valuation. Spot Bitcoin ETFs accumulated approximately $1.45 billion in net inflows during the most recent five-day trading period.

Bitwise Chief Investment Officer Matt Hougan shared in a March 2 interview that numerous institutional allocators view current price levels as attractive entry points. One prospective client committed $11 million following a two-year consultation process with Bitwise.

“They’re not surprised that crypto is volatile,” Hougan said. “They’ve been waiting for an entry point.”

Hougan explained that typical Bitwise clients require an average of eight meetings before committing capital, with many holding only quarterly decision-making sessions. He emphasized that what appears as reluctance often reflects standard institutional allocation procedures.

By the fourth quarter, three out of four major wirehouses gained authorization to proactively present Bitcoin opportunities to their client base.

Blockchain Metrics Reflect Measured Sentiment

Glassnode analytics reveal gradual improvement without indicating strong bullish conviction.

Bitcoin’s Relative Strength Index climbed to 41 from the previous week’s reading of 36. The indicator continues trading beneath the 50 threshold that would suggest buyer dominance.

Daily trading volume expanded to $9.6 billion from $6.6 billion, while spot market activity shows increasingly balanced buying and selling flows.

Derivatives activity continues reflecting seller dominance over buyers, with the funding rate for leveraged long positions declining.

Prediction market data reinforces this cautious outlook. The likelihood of Bitcoin declining to $65,000 during March decreased by 11 percentage points to 73%. The probability of touching $60,000 dropped 10 points to 41%.

A Polymarket contract measuring whether Bitcoin reaches $60,000 before $80,000 decreased by 12 points to 61%.

At the time of publication, BTC was trading at $66,360.