Bitcoin's Volatile Recovery: Bullish Trend Persists Despite Tariff Impact

Bitcoin's price action has been volatile, with the cryptocurrency swiftly recovering from a sell-off sparked by U.S. tariff announcements. Despite lingering bearish sentiment, the broader trend remains bullish, according to an analysis by TradingShot. The analyst expects Bitcoin to consolidate sideways throughout March, attempting to establish a firm bottom before making a decisive move. Historical price trends suggest that a potential breakout could unfold within a month.

Bitcoin's latest rebound highlights buying activity at critical support levels, though it continues to face resistance at the 50-day moving average (1D MA50) near $99,000. Historical trends indicate that Bitcoin could remain range-bound for another month before making a decisive move, much like the August 2023 pattern. A break above the 1D MA50 would be a strong bullish confirmation, signaling the start of a rally that could push its price toward $160,000.

While technical indicators suggest Bitcoin is in a bottoming phase, on-chain data provides further insight into shifting market dynamics. According to CryptoQuant analysts, as Bitcoin reached its all-time high (ATH), market data showed a shift in supply dynamics, with short-term holders (STH) increasing their holdings while long-term holders (LTH) gradually selling their holdings. Historically, a decline in LTH supply has coincided with market tops, as long-term investors take profits while STH absorbs selling pressure, leading to overheated market conditions. CryptoQuant's analysis noted that Bitcoin is in a pullback phase following its ATH, with the market likely to continue consolidating due to liquidity constraints. Short-term rallies may face resistance until BTC establishes a new accumulation phase.

At press time, Bitcoin is trading at $89,661, posting a 6% gain in the past 24 hours and a modest 1% increase on the weekly chart. Bitcoin's recent rebound indicates strong buying interest at lower levels, but its ability to break through the key resistance at $99,000 remains the critical factor in determining the next phase of its trend.