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As the Crypto Fear and Greed Index plunges to 35, market sentiment reflects growing fear and uncertainty. Bitcoin struggles to find strong footing near the $97,000 mark, battling against a pullback of 1.08% over the past 24 hours.
With a market valuation still under $2 trillion, Bitcoin’s momentum remains weak. While a potential morning star pattern hints at a bullish comeback, the sudden halt in institutional support warns of a deeper correction.
Will a turnaround in institutional demand propel $BTC price back to the $106,000 mark?
Bitcoin at $97k Aims For A Comeback
In the daily chart, Bitcoin’s price decline tests a crucial local support trendline. With a doji candlestick formed yesterday, today’s intraday recovery of 1.13% hints at a morning star reversal.
Currently, the $BTC price consolidates between the 50-day and 100-day EMA lines, keeping traders cautious. However, the previous pullback has triggered a bearish trend in the MACD and signal lines.
Thus, the momentum indicator presents a sell signal, despite Bitcoin sitting at a key support level. This generally contradicts the buy at support, sell at resistance strategy.
For now, the morning star pattern strengthens the chances of a bullish reversal rally, which could drive a broader market recovery.
Ascending Triangle Formation: Bullish Breakout or Breakdown?
On a larger scale, the local support trendline forms an ascending triangle pattern, with the overhead ceiling at $106,000. If the $BTC price maintains support within this pattern, it could see a short-term market recovery.
In such a case, Bitcoin could test the overhead resistance, projecting an upside potential of nearly 10%. However, if bulls fail to sustain dominance at this support level, the $BTC price could witness a major crash.
The immediate support for Bitcoin stands at $91,000, and a closing below this level would significantly increase downside risks.
Institutional Activity: ETF Flows Reveal Mixed Sentiment
On February 6, the daily total net inflow of U.S. Bitcoin spot ETFs remained negative. Grayscale $BTC Mini Trust was the only buyer, with an inflow of $5.15 million.
However, the major selling came from Fidelity, offloading $103.25 million, while Grayscale $BTC Trust sold $42.21 million. This reveals a diverging viewpoint between Grayscale Mini $BTC Trust and Grayscale $BTC Trust.
Currently, Grayscale $BTC Trust has a cumulative net outflow of $21.91 billion, reflecting continued selling pressure. Meanwhile, the largest Bitcoin ETF, BlackRock, with a total net asset value of $56.252 billion, maintained a neutral stance with zero net flow.