Bitcoin price rebounded to an intraday high of $71,850 on Monday after it reclaimed the $70,000 psychological support amid a spike in short liquidations and a fresh macro catalyst.

According to data from crypto.news, Bitcoin (BTC) surged back above the $70,000 psychological support level late Sunday before pushing higher to a daily high of $71,852 on Monday morning during Asian trading hours.

Trading at $70,847 when writing, its rally follows a volatile week where it had plummeted to a 16-month low of approximately $60,033 amid macroeconomic and geopolitical concerns. These included the nomination of Kevin Warsh as the U.S. Federal Reserve Chair, which has brought a hawkish air towards monetary policy due to his reputation for prioritizing inflation control, and the threat of a U.S. government shutdown as the funding crisis escalated before being resolved by a new spending bill.

Amidst the market-wide blood bath that followed, the Fear and Greed Index used to gauge investor sentiment fell to a level of six. This represents one of its lowest readings ever and indicates extreme fear in the market. Such levels were last seen during major market crashes, including the COVID-19 downturn and the collapse of FTX, when panic gripped the global financial landscape.

Why did Bitcoin price rebound today?

The Bitcoin price rebound today follows renewed inflows into its spot exchange-traded funds. Data from SoSoValue shows that spot Bitcoin ETFs recorded $371 million in net inflows on Feb. 6, breaking a three-day outflow streak that saw $1.25 billion exit the funds.

Traders may interpret such inflows as a sign that institutional investors may be returning to the market, which in turn could bolster retail confidence and boost short-term price momentum if such flows continue throughout this week.

However, it must be noted that a similar pattern unfolded over the previous trading sessions, where modest inflows were posted after several days of outflows, but it failed to translate into sustained multi-day accumulation, as selling pressure resumed almost immediately.

Another major catalyst for Bitcoin’s uptick today was the supermajority victory of Prime Minister Sanae Takaichi in Japan’s general election. Her mandate for an aggressive $135 billion expansionary fiscal stimulus package fueled a record 3.4% surge in the Nikkei 225, which rippled into risk assets, especially Bitcoin.

Analysts also note that last week’s drop to $60,000 served as a litmus test that washed out excessive leverage and speculative weak players. Meanwhile, data from CoinGlass shows that nearly $180 million of short positions were liquidated in the past 24 hours, nearly six times the liquidations from long positions.

When traders with short positions get liquidated, they have to buy back the asset to cover their positions, which in turn creates strong upward pressure on the price.

Bitcoin price analysis

The daily chart shows that Bitcoin has rebounded back above the $70,000 support level, which it had been struggling to maintain throughout the recent period of volatility.

The MACD indicator shows early signs of a bullish crossover forming, which means bulls are starting to regain control of the market momentum. However, the Aroon indicator presents a more cautious outlook with the Aroon Down still at 75.8%, significantly higher than its Up counterpart, suggesting that the downtrend in the market is yet to be fully dissipated.

Based on these mixed signals, the most likely short-term scenario appears to be still bearish with Bitcoin likely to drop below $70,000 and lower if market sell pressure continues to dominate. On the contrary, a sustained rebound above its April 2025 low of over $74,500 could serve as a key entry point for a more definitive trend reversal.