The price of Bitcoin (BTC) has experienced significant fluctuations over the past 12 hours and is currently trading at approximately $83,000. Although this level marks a recovery from the late-February low of $78,000, Bitcoin has erased most of its weekend gains after briefly surging to nearly $95,000. The market remains highly volatile, with uncertainty prevailing.
Bitcoin’s Recent 12-Hour Price Movement
Between the night of March 3 and the early hours of March 4, Bitcoin fell sharply from around $90,000 to a low of approximately $82,000, marking a sudden 7% decline within just 12 hours. The price has since recovered slightly but remains significantly lower than where it was half a day ago. This rapid drop appears to have been triggered by profit-taking and a cooling-off of the bullish sentiment that emerged over the weekend. Some analysts believe the rally was largely driven by a short squeeze, where traders betting against Bitcoin were forced to buy back their positions, leading to temporary price inflation. The unwinding of this situation may have contributed to the swift decline.
Recovery from Late-February Lows
In late February, Bitcoin suffered a major decline, reaching a low of $78,273 on February 28, its lowest level since November 2023. At that time, market sentiment was weighed down by concerns over U.S. policy uncertainty and continued monetary tightening. However, conditions reversed dramatically in early March when U.S. President Donald Trump hinted at including cryptocurrency in the country’s strategic reserves. The market reacted positively, and Bitcoin rebounded over 20% within days, briefly touching $95,000 over the weekend. Despite this rally, the price has since retreated, raising questions about the sustainability of the uptrend.
Market Sentiment and Investor Behavior
The dramatic price fluctuations have led to rapid shifts in market sentiment. By late February, investors were largely pessimistic due to regulatory concerns and macroeconomic uncertainty, with some fearing a drop below $70,000. However, Trump’s announcement ignited bullish sentiment, prompting strong buying activity among both institutional and retail investors. Trading volumes surged, and capital inflows accelerated.
Despite the initial excitement, some experts remain skeptical. Former BitMEX CEO Arthur Hayes downplayed Trump’s statement, arguing that “it is merely rhetoric without concrete financial backing.” Similarly, hedge fund CIO Quinn Thompson criticized the enthusiasm surrounding the announcement, cautioning against overoptimism.
As the weekend rally faded, many investors opted for profit-taking and risk management, shifting sentiment back to a more cautious stance. However, long-term bullish investors remain confident. CryptoQuant CEO Ki Young Ju predicts that Bitcoin’s bull market will continue through April 2025, with $77,000 seen as a strong support level. While the price remains above this threshold, the long-term trend remains intact.
Macroeconomic Factors and Key Considerations
Beyond the cryptocurrency market, broader macroeconomic factors have also influenced Bitcoin’s price movement. The Trump administration’s announcement of new tariff measures against Mexico, Canada, and China has heightened market concerns about trade tensions, leading to increased demand for safe-haven assets like the U.S. dollar. This has put downward pressure on risk assets, including Bitcoin.
Additionally, persistently high U.S. inflation suggests that the Federal Reserve will maintain tight monetary policy, dampening expectations for near-term rate cuts. The rising VIX volatility index in U.S. stock markets further reflects investor uncertainty, which has also contributed to the recent pullback in Bitcoin’s price.
Given these circumstances, Bitcoin is likely to experience continued volatility in the near term. The psychological resistance level at $95,000 has now been established, while the $77,000 range serves as key support. Traders and analysts will closely monitor the Trump administration’s crypto policies, as well as U.S. monetary policy developments, to gauge Bitcoin’s next moves.
