Bitcoin bulls tricked bears again at $78K

Bitcoin (BTC) is back from the dead. After plunging below $77K this week, BTC bounced back to retain the $84K mark. The sell-off that started with Trump’s tariff spree and government shutdown threats sent all risk assets tanking. Bitcoin ETF outflows hit records, and traders started hedging for a brutal drop to $70K.

The fresh recovery rally now looks like a trap set up for bears. As the US avoided a government shutdown and inflation fears cooled, markets found their footing. The global digital asset market cap surged by around 2% in the last 24 hours to stand at $2.74 trillion. Its 24-hour trading volume remained quite low at $75 billion.

FUD at $78K, FOMO at $100K

As per the data shared by Santiment, Bitcoin’s run back to $84.5K on Friday depicts what happens when a crowd on Monday claims that it’s time to sell. Possibly, FUD hit its peak when BTC was trading around $78K, and several bearish predictions began to pour out of nowhere for lower prices all across social media.

A similar instance took place at the end of February, when retail traders were convinced that the market was going to tank even lower. However, the Bitcoin price soared temporarily at the beginning of March. Over the last month, investors haven’t seen the BTC price drop below $70K or rise back above $100K. This suggests that the crowd’s social media prediction of BTC price dipping to $70K is a great gauge for FUD, while BTC to boom above $100K is a hint of bugging FOMO.

The blue bars in the chart represent $10K-$69K Bitcoin predictions, which often signal buying opportunities as they indicate peak fear in the market. On the other hand, the clusters of red bars showing BTC predictions soaring past $100K act as a sell signal as they reflect overheated FOMO and excess greed.

Bitcoin traps shorts

Bitcoin price surged by around 2% in the last 24 hours to hover around the $84k mark. Meanwhile, it is still down by 13% over the past 30 days. The recent surge has surely fooled traders as CoinGlass data shows that more than $72 million worth of long and short positions got liquidated over the last day. However, almost $51 million worth of liquidated bets (70%) turns out to be short positions. This suggests that traders were expecting the BTC price to fall, but the sentiments improved, and BTC took off.

The market began to print green indexes after a mix of political chaos, macro factors, and Trump’s crypto chess moves. After Bitcoin’s resumption of relief rally, even altcoins got a boost Solana jumped 5%, Cardano 3%, and XRP nearly 4%.

Trump’s recent crypto summit at the White House might’ve helped too. His executive order on a Bitcoin strategic reserve and the SEC’s dropped lawsuits against major crypto firms sent a wave of optimism through the market. But BTC is still down 30% from its all-time high of $109K on inauguration day and traders are now watching key macro trends like inflation and tariffs to see if this bounce has legs.

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