Bitcoin surged back above $65,000 on Wednesday, recovering from a brief crash to $62,000 the previous day, as a weaker U.S. dollar and rallying Asian stock markets provided a tailwind for cryptocurrency prices. The leading cryptocurrency reached approximately $65,400 in early trading, marking a 2% gain that helped lift the broader crypto market.
The recovery comes after weeks of heavy losses that saw Bitcoin fall nearly 50% from its all-time highs, with the total cryptocurrency market capitalization dropping to $2.19 trillion – close to lows seen during the February 5 crash. Analysts are closely watching whether this bounce signals a genuine trend reversal or merely a temporary reprieve before further declines.
Technical analysts have identified a potential "double bottom" chart pattern forming in the crypto market. Alex Kuptsikevich, chief market analyst at FxPro, explained that if the current lows hold, the market could see roughly 10% upside. However, he issued a stark warning: "A failure to rebound will signal the end of the recovery, opening the potential for a further 25% decline." A double bottom pattern forms when price drops to a low, recovers briefly, then falls back to test the same level again, creating a W-shaped formation that traders often interpret as bullish.
Other major cryptocurrencies followed Bitcoin's recovery, with Ether gaining 4.2% over the past day, Solana rising 7%, and XRP adding 3%. The positive movement coincided with Asian equity markets reaching record levels, particularly in South Korea and Taiwan where AI-linked chipmakers hit all-time highs ahead of Nvidia's earnings report.
The U.S. dollar weakened following President Trump's State of the Union address on Tuesday night, where he doubled down on tariff plans despite the Supreme Court striking down his global import taxes. Trump suggested tariffs could eventually replace the income tax system entirely. Historically, a weaker dollar has supported Bitcoin prices, though this relationship has been inconsistent during the recent downturn.
Despite the price recovery, confidence in Bitcoin remains fragile. Bloomberg reported analysts describing a "crisis of confidence" after Bitcoin's steep decline from peak levels. Kuptsikevich went further, stating that the market likely hasn't bottomed yet and that "real capitulation is still ahead."
All eyes are now on Nvidia's quarterly earnings report, scheduled for release after market close on Wednesday. U.S. stock futures were largely flat on Wednesday morning, with Dow futures up 27 points, S&P 500 futures higher by 0.1%, and Nasdaq 100 futures up 0.3%. This follows a strong Tuesday session where the S&P 500 closed up nearly 0.8%, the Nasdaq gained about 1%, and the Dow added 370 points as investors rotated back into technology stocks.
Traders are also monitoring geopolitical developments, including rising U.S.-Iran tensions, and a 10% levy on imports that took effect Tuesday. Alongside Nvidia, companies including Salesforce and Snowflake are also reporting earnings on Wednesday.
