Bitcoin Rally Faces Two Major Hurdles Before Bullish Reversal Can Be Confirmed

Bitcoin has extended its recovery this week, climbing back above the 66,000 level as risk appetite improves across financial markets. The rebound has been supported by a combination of easing geopolitical tensions following the US-Iran peace agreement, renewed enthusiasm for growth assets after the highly anticipated SpaceX market debut, and signs that institutional demand may be stabilizing after weeks of persistent outflows from spot Bitcoin ETFs.

The improvement in ETF flows has been particularly encouraging for crypto bulls. US spot Bitcoin ETFs recorded net inflows of USD 85.9m on a single day late last week, marking the strongest daily intake in roughly a month. While one day does not establish a trend, it suggests institutional investors may be becoming more willing to add exposure as broader market sentiment improves. Combined with the relief rally sweeping equities and other risk-sensitive assets, this has helped Bitcoin recover from recent lows.

Nevertheless, the recovery still faces significant technical tests before it can be considered a genuine trend reversal. The first hurdle lies at 38.2% retracement of 82,822 to 59,081 at 68,150. Rejection at this Fibonacci resistance, particularly if followed by a break of support at 63,644, would suggest the current advance is merely corrective. Under that scenario, a retest of 59,081 would likely follow quickly, with renewed pressure on the key psychological 60,000 level.

The second and arguably more important barrier sits at the falling 55 D EMA (now at 70,851). Even if Bitcoin clears the retracement resistance, failure at the 55 D EMA would keep the broader bearish structure intact and suggest further consolidation is needed before a sustainable rally can develop. In contrast, a sustained break above the moving average would represent a significant technical improvement and shift attention back toward resistance at 82,822.

For now, the defense of the 60,000 area is an important positive development. However, Bitcoin still needs to prove it can do more than rebound from oversold conditions. Until 68,150 and 70,851 are decisively overcome, the recovery deserves respect, but a full bullish reversal cannot yet be assumed.