9 min readBitcoin rose 5.5% last week, recovering from a 65k low to a high of 73.9k, briefly breaking out of the 65-71k range it has traded within since the start of February. The price is extending those gains on Monday, as it looks to break out above the 74k March high.
The move higher has not been limited to Bitcoin, with altcoins across the board also experiencing solid gains over the past 7 days. Ethereum gained 8.5%, BNB and Solana traded around 7.5% higher. Meanwhile, XRP and ADA rallied by more than 4%.
The total cryptocurrency market capitalisation reached a peak of $2.50 trillion on Monday, a 12-day high, up from the $2.17 trillion February low. However, this is still considerably down from October’s $4.28 trillion high.
Sentiment analysis showed that the mood towards crypto improved slightly to 15, which is still in Extreme Fear territory but up from the record low of 5 last month.
Crypto liquidation remained relatively muted across the week. Liquidations spiked on Friday to $470.08 million as the BTC price rose to 74.5k.
Macro backdrop
Bitcoin has outperformed in recent weeks, showing resilience amid ongoing tensions stemming from the US-Israeli war against Iran, which is heading into its third week.
Bitcoin has risen over the past 6 straight sessions, even as other risk-sensitive assets such as stocks have fallen. The S&P 500 fell over the past 4 consecutive sessions, dropping 1.6% last week and 3.5% since the start of the conflict, compared with a 7% rise in BTC.
Furthermore, Bitcoin has risen even as safe-haven gold has declined on USD strength. The USD has tracked treasury yields higher amid inflationary concerns as oil and energy prices surge. Typically, rising treasury yields draw liquidity from the crypto space, but that hasn’t been the case in recent weeks. The resilience in BTC is a pattern that hasn’t been seen for some time, and while BTC is a long way from being seen as a store-of-value digital gold, investors may be seeing it as a digital escape.
Not even a rise in core CPE, the Fed’s preferred inflation gauge, to 3.1% YoY, and a downward revision to US GDP to 0.7% annualised in Q4 were sufficient to deter BTC buyers.
Despite this macro uncertainty, Bitcoin has held its ground, helped in part by the returning institutional demand and encouraging on-chain data.
BTC ETFs post net inflows
BTC ETFs recorded 5 consecutive days of net inflows, totalling $767 million. This marked the third straight week of net inflows, a run not seen since September last year. Furthermore, March has so far recorded net inflows of $1.34 billion, following 4 consecutive months of net outflows.
The rebound in ETF flows suggests that institutions are increasingly seeing 70k as an attractive entry point, despite the Iran war.
Historically, BTC has shown a pattern of an initial selloff at the start of a geopolitical crisis, such as the 2022 Russian invasion of Ukraine or the 2020 US-Iran flare-up, only to deliver double-digit rallies in the months that follow.
On the corporate front, Michael Saylir announced that Strategy purchased an additional 3,015 BTC earlier this month, taking the firm’s total holdings to 738,731 BTC, highlighting its continued accumulation strategy. The average purchase price is $75,862.
Sellers on exchange fall to an 8-year low.
According to on-chain data, the amount of Bitcoin held on cryptocurrency exchanges has fallen to its lowest level since 2017.
The chart below shows the percentage of Bitcoin’s total circulating supply sitting in known exchange wallets. After peaking in early 2020, the metric has been in a persistent downtrend, with investors consistently moving their assets off exchanges over the last six years.
The decline in exchange supply can be attributed to several factors. These include the approval of spot BTC ETFs and the expansion of institutional adoption, meaning that large amounts of Bitcoin are being accumulated and locked away in enterprise-grade custody solutions. Meanwhile, retail investors and whales alike are increasingly moving their holdings to cold storage hardware wallets.
When the percentage of supply on exchanges is low, it means order books can become thinner.
This means that even moderate buying pressure can trigger significant upside price volatility in a low-liquidity environment, as there are fewer sellers available.
Are Bitcoin bears fading?
The Bitcoin Bull Score Index, a gauge of bullishness or bearish sentiment, rose to 30. This marks the highest level recorded since October last year, after the index had been significantly lower for an extended period. The recent shift points to bearish pressure in the market starting to fade after dominating the market for weeks. This also reflects improving capital flows.
While this doesn’t confirm the start of a sustained rally, it does point to a shift in sentiment, which could precede a bullish move.
BTC activity picks up
While the BTC price is rising, market activity is also increasing. For example, active addresses on the network have shown consistent growth, reaching nearly 639,000 active addresses as of the end of last week. This points to a notable increase in activity, which, combined with rising prices, suggests stronger demand for Bitcoin.
When observing the number of confirmed transactions per day, a consistent increase has been seen in recent sessions, with the indicator reaching around 440,000 transactions last week after recording lows of around 380,000 the week before.
This steady rise in network activity, together with the increase in Bitcoin’s price, highlights growing user engagement and strengthening appetite for BTC.
MVRV Z -Score: A reason to be cautious
While several on-chain metrics suggest Bitcoin may be forming a local bottom, the MVRV Z-Score indicates the market could still experience a final shakeout before a sustained bullish move begins.
The MVRV Z-Score measures whether Bitcoin is overvalued or undervalued by comparing its market value to its realised value — essentially the average price at which coins last moved on-chain. When the score moves into negative territory, it suggests that Bitcoin’s market price has fallen below the average cost basis of holders.
Some analysts view a drop in the MVRV Z-Score to around -0.262 as a key level that has historically preceded strong rebounds in Bitcoin. This occurred in 2015, 2019, and during the 2022 bear cycle, each of which was followed by a sustained bullish trend.
If that pattern holds, the current Z-Score of 0.469 suggests there could still be some downside before Bitcoin begins a stronger recovery.
Looking ahead
Attention is now turning to the upcoming Federal Reserve rate decision, where the central bank is widely expected to leave interest rates unchanged in the 3.5%–3.75% range.
Recent data showed inflation remains above target, and growth slowed in Q4. However, much of this data is already somewhat outdated, as it does not fully reflect recent geopolitical developments, particularly the impact of the conflict in the Middle East on energy prices and inflation.
As a result, the market will focus more on the Fed’s updated projections and the dot plot, which could provide clearer guidance on the future path of interest rates.
Currently, markets are pricing in one rate cut in 2026 in October. However, if oil prices remain persistently high and inflation pressures increase, the Federal Reserve may be forced to delay easing further or keep rates elevated for longer. Higher rates for longer often bode poorly for BTC due to lower liquidity. Therefore, a hawkish Fed could spur a move lower for BTC.
BTC technicals
The BTC chart shows the price has risen above the 50 SMA and is on the brink of breaking out from its near-term consolidation pattern. A meaningful push above 74k could spur a move to 80k, putting BTC on firmer footing.
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