Bitcoin (BTC) is showing signs of a potential price reversal as key technical indicators flash major buy signals while the cryptocurrency trades below the $80,000 level. According to market analyst Ali Martinez, the 12-hour chart has printed both a "TD 9" and a "TD 13" signal from the Tom DeMark (TD) Sequential indicator, an uncommon convergence that has historically preceded significant trend reversals.
The TD Sequential indicator is a tool used to identify trend exhaustion and potential price inflection points. The appearance of a "TD 9" suggests bearish momentum has been pushed too far, while a "TD 13" signals the end of a "countdown" phase. Their simultaneous occurrence indicates selling pressure may have peaked, setting the stage for a potential rebound. BTC is currently trading between $76,000 and $78,000, with analysts suggesting a move back above $80,000 is likely if these signals hold.
Market sentiment remains cautiously optimistic, bolstered by continued institutional investment activity, particularly in spot Bitcoin exchange-traded funds (ETFs). Despite $1.7 billion in outflows from crypto funds last week—which turned year-to-date inflows negative—early indicators suggest selling pressure is easing. The Coinbase Premium Index, which measures the price difference for Bitcoin on Coinbase versus other exchanges, is recovering from its lows, hinting at a gradual return of U.S. buying demand.
A critical level to watch is the average cost basis of all U.S. Bitcoin ETF holdings, which CryptoQuant data places at approximately $79,000. Historically, since the approval of U.S. Bitcoin ETFs, BTC has rarely remained below this level for extended periods. This zone has acted as a demand support, with prices typically recovering within one to two weeks after testing it, as seen during the bearish phase in Q3 2024.
Additional positive signals come from Swissblock, a Switzerland-based crypto analytics firm, which noted a positive convergence between Bitcoin's network growth and liquidity in early February. The last time these metrics recovered together from low levels was in 2021, just before Bitcoin reached a new all-time high.
However, not all outlooks are bullish. Alex Thorn, Head of Research at Galaxy Digital, warned that Bitcoin's recent weakness could persist, with the price potentially falling toward the 200-week moving average near $58,000 in the coming weeks or months, driven by declining liquidity and a lack of positive short-term catalysts.
Analysts emphasize that while technical indicators are not guarantees, the confluence of signals—including the TD Sequential buy setup, the ETF cost basis support, and the recovering Coinbase Premium—provides a strong case for a potential relief rally. The broader macroeconomic environment, including upcoming inflation data and Federal Reserve statements, is expected to play a crucial role in determining whether this technical rebound can propel Bitcoin back toward its previous highs.
