Bitcoin’s price has experienced significant fluctuations recently, finding support at the $77,000 level after a sharp drop from the $95,000 mark the previous week. Although Bitcoin showed some resilience by trimming losses last week, it remains within a weak market sentiment, reflecting broader uncertainties in both the cryptocurrency and traditional stock markets. This period of consolidation has been largely attributed to the tariff-driven trade tensions currently affecting the global financial landscape.

Bitcoin Price Action

Bitcoin’s price action has moved in a somewhat positive direction over the past week. By the close of trading on Friday, March 14, Bitcoin had rebounded to around $82,000, after dipping to a low of $76,577 on Tuesday, March 11. This bounce back to the $82,000 level has raised some optimism among traders. However, the larger trend still leans bearish in the short term, particularly on the 4-hour and 1-hour charts, which show a continuation of the downward pressure.

One of the key observations in the market is the sentiment, as indicated by the Bitcoin Fear & Greed Index, which continues to remain in the “fear” zone. The index, which measures market sentiment, shows that investors are still nervous, even though Bitcoin’s price has been moving up in recent days. This indicates that while the market might be stabilizing, a sense of cautiousness prevails among traders.

Market Structure and Sentiment

Looking at the broader market structure, Bitcoin still shows a bullish trend on larger time frames, particularly since breaking above the $74,000 level in November 2024. Despite the recent decline, Bitcoin is still trading significantly above this key support, which suggests that the long-term trend remains intact. However, if the downtrend continues, there could be a chance for Bitcoin to retest this support zone at $74,000, which would likely attract buying interest from long-term holders.

Open interest data from the Chicago Mercantile Exchange (CME), where Bitcoin futures contracts are heavily traded, shows that the volume of open contracts increased last week, particularly after the dip on March 10. This increase in open interest suggests that many traders are taking long positions, implying some degree of optimism in the market. However, this could also point to the fact that many investors are betting on a short-term rebound, which could lead to significant volatility in the coming weeks.

Tariff-driven Uncertainty and ETF Outflows

An external factor contributing to the overall market uncertainty is the looming tariff imposition scheduled for April 2. The global markets, including both equities and cryptocurrencies, are being roiled by the uncertainty surrounding these tariffs. As a result, there is growing concern that trade disruptions could lead to broader economic implications, creating further volatility in the financial markets.

In addition to these external factors, exchange-traded funds (ETFs) have seen outflows for the third consecutive week. This suggests that institutional investors are becoming more cautious, opting to de-risk their portfolios by pulling out of certain assets, including Bitcoin. The ETF outflows are another indication of the current bearish sentiment, as many investors are adopting a wait-and-see approach.

Outlook

Despite finding support at $77,000, Bitcoin has not been able to break above local highs, indicating a lack of conviction for a strong rally. As of now, Bitcoin is trading at $83,083, and while there are signs of short-term stabilization, the broader sentiment remains weak. Traders will continue to monitor the $77,000 support level closely, as any break below this could signal a further decline. A potential retest of the $74,000 level may also be on the horizon if the bearish pressure continues.

In conclusion, while Bitcoin’s price has found some support and shown a mild recovery, the global uncertainty and weak sentiment are still weighing on the market. Traders and investors remain cautious, and unless there is a shift in market sentiment or a positive catalyst, Bitcoin’s price could continue to face downward pressure in the short to medium term.