Digital assets staged a broad rebound Wednesday, aided by a softer U.S. dollar and strong gains in Asian equities. Still, analysts remain divided over whether the Feb. 5 trough will ultimately prove to be the cycle low.
Bitcoin (BTC) moved back above $65,400 in early trading, benefiting from renewed risk appetite and currency tailwinds that delivered crypto’s most decisive bounce in weeks.
Earlier in the week, total crypto market capitalization had fallen to roughly $2.19 trillion, nearly matching levels seen during the Feb. 5 crash. That retest has sharpened focus on the technical setup now unfolding.
If support holds, the market could be forming a classic double-bottom pattern, suggesting approximately 10% upside, according to Alex Kuptsikevich, chief market analyst at FxPro. However, he warned that a failed rebound would likely mark the end of the recovery attempt and expose the market to an additional 25% decline.
A double bottom is a traditional bullish reversal formation that appears after a sustained downtrend. It consists of two similar lows separated by a temporary rally, creating a “W” shape on price charts. Confirmation typically comes when prices break above the midpoint high between the two troughs.
The key test now is whether the rally can extend beyond the short-lived recovery to roughly $2.47 trillion in total market value seen about 10 days ago.
Altcoins advance as Asia rallies
Major tokens followed bitcoin higher. Ether gained 4.2% over the past 24 hours, solana climbed 7%, and XRP added 3%.
The move coincided with a 1.4% surge in MSCI’s Asia equity gauge to a record high, led by South Korea and Taiwan. AI-related chipmakers in those markets reached fresh all-time highs ahead of earnings from Nvidia later in the day.
Currency markets also supported the advance. The Bloomberg Dollar Spot Index edged lower following President Donald Trump’s State of the Union address, where he reaffirmed tariff plans despite a Supreme Court ruling invalidating his global import tax framework. He also suggested tariffs could eventually replace the federal income tax system.
A weaker dollar has historically been favorable for bitcoin, although that relationship has been inconsistent during the current correction.
Despite the rebound, sentiment remains fragile. Bloomberg reported that analysts it surveyed described a “crisis of confidence” in bitcoin following its nearly 50% drop from record highs, pointing to a lack of fresh catalysts to drive sustained gains.
Kuptsikevich echoed that caution, arguing the market likely has not yet reached full capitulation and warning that “real capitulation is still ahead.”
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