Bitcoin briefly returned to $60k and then fell back! Is this a dead cat bounce or bottoming in the long-short tug-of-war?

Bitcoin once briefly reclaimed the $60k level, then fell back to $59,552 due to insufficient buying momentum, as bulls and bears continue their tug-of-war.

Bitcoin briefly reclaimed $60k, then fell back again

Bitcoin ($BTC) briefly reclaimed the $60k round number level after several days of sharp declines, but buying pressure failed to sustain the price increase. At the time of writing, Bitcoin is trading at $59,552, with bulls and bears still locked in a tug-of-war. Market focus has also shifted from the panic over breaking support levels to whether the recent rebound signals that selling pressure is gradually being absorbed, or if it is just a technical correction within a bearish trend.

Source: CoinGecko Bitcoin price at $59,552, bulls and bears still locked in a tug-of-war

Recently, Bitcoin has broken below $60k and $58k in succession. Combined with U.S. core PCE inflation coming in higher than market expectations, delayed expectations of Fed rate cuts, and continued dollar strength, market risk appetite has cooled rapidly. A large number of leveraged long positions have been liquidated. Even as prices temporarily rebounded, market sentiment remains cautious.

• Related news: Bitcoin briefly broke below $58k! Core PCE inflation hit a 3-year high, triggering a global sell-off.

ETF outflows continue, market absorption capacity remains to be seen

In addition to macroeconomic factors, spot ETF flows remain one of the most watched indicators in the market.

U.S. spot Bitcoin ETFs have seen continued outflows recently, with the largest ETF facing significant redemption pressure. Market analysts believe that until ETF net inflows stabilize, each price rebound may encounter new selling pressure, keeping the market's ability to absorb supply under constant scrutiny.

Spot ETFs have historically been a major source of funds driving Bitcoin to new highs. The recent weakening of flows also reflects that some institutional investors are maintaining a wait-and-see attitude toward short-term market conditions.

On-chain data shows signs of capitulation, analysts remain divided

Some on-chain data has begun to show signs of market capitulation. According to CryptoQuant analysts, recent indicators related to unspent transaction outputs (UTXOs) suggest that some short-term holders have chosen to sell at a loss. Similar situations have historically appeared when the market was approaching a phase bottom.

Source: CryptoQuant Unspent Transaction Output (UTXO) indicators show that some short-term holders have chosen to take losses, similar to past situations when the market was nearing a phase bottom.

However, some analysts believe it is still too early to confirm that the market has bottomed out. If Bitcoin cannot firmly reclaim $60k, it means that selling pressure has not yet been fully absorbed, and the recent rebound may still be a technical repair within a bearish trend.

On the other hand, Bitcoin may also record a rare two consecutive quarterly declines this quarter, reflecting the impact of a high interest rate environment, a strong dollar, and insufficient market liquidity, all of which continue to weigh on the cryptocurrency market.

Weekend movements become an important observation point for the next stage

Analysts believe that weekend price action will be a key moment to gauge market direction. Since the cryptocurrency market operates 24/7, weekend trading volumes are typically lower than on weekdays, making prices more susceptible to larger swings due to lower liquidity.

If Bitcoin can firmly reclaim $60k, accompanied by rising volume and improved ETF flows, market confidence may gradually recover, helping to confirm that the recent lows have formed a support level.

If the price remains constrained at the $60k level, or even breaks below $58k again, the market may test lower support zones. Until there are clear changes in fund flows, Fed policy, and the macroeconomic environment, the cryptocurrency market is likely to remain highly volatile, and there are still differing views on whether this rally has completed the bottoming process.

This article was generated by an encrypted agent summarizing information from various sources, reviewed and edited by Cryptocities. It is still in a training phase and may contain logical biases or information errors. The content is for reference only and should not be considered investment advice.