Bitcoin Rebound Gains Strength, Yet This Key Signal Warns It’s Not Over

Futures data flipped bullish, yet Bitcoin’s price structure lags.

Bitcoin saw a sharp recovery on Wednesday after Iran’s Supreme National Security Council accepted a two-week ceasefire. The crypto asset briefly climbed above $72,700 after posting over 5% daily gains before stabilizing near $71,600.

The rebound was particularly visible in the derivatives market, where sentiment indicators indicated a strong upward reversal. But the overall structure may still be weak.

Risks of Rejection Still Loom

During this period, the Bitcoin Futures Advanced Sentiment Index rose significantly from 23.4 to 53.1, according to the latest findings by analyst Axel Adler Jr. This index, which aggregates multiple components including price action, taker flow, open interest, and signed volume delta, revealed that the recovery was not limited to price alone.

The market was found to have exited a short-term pressure phase and entered a period of renewed risk appetite. However, despite this rebound, the sentiment index had previously reached a higher local peak of 65.6 before easing slightly, which means that some momentum has already cooled.

While the smoothed version of the index continued to trend upward and currently holds near 41.8, the latest data shows stabilization rather than continued acceleration. Therefore, a “sustained” strength is needed to maintain the recovery.

At the same time, Bitcoin’s underlying price structure has improved at a slower pace compared to derivatives. The Structure Shift Composite Signal, which measures the position and strength of price within a 21-day trading channel, moved from -0.58 to -0.03 over the same period.

This change demonstrates that the market has transitioned from a clearly negative structure to a near-neutral state. However, price remains positioned at roughly 29% of its 21-day range, meaning it is still trading in the lower portion of the channel rather than approaching the upper boundary. Such a trend formation hints that while downside pressure has eased and the structure has stabilized, it has not yet confirmed a sustained upward regime.

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For a more definitive reversal, the market would need to maintain its position above crucial medium-term moving averages, establish a consistently positive structural signal, and push higher within the channel.

There is a clear divergence between derivatives sentiment and price structure. It highlights that while futures data points to a rapid improvement in sentiment and positioning, the underlying price action has not yet fully aligned with this optimism. This imbalance suggests that the recent rally may still be in a transitional phase rather than a confirmed trend reversal. In practical terms, the market now appears stronger than it did a few days ago, but it has not yet established the conditions necessary for sustained growth.

Short-Term Direction at Crossroads

Amid this slightly improved but still uncertain outlook, another analyst, Ted Pillows, said that as Bitcoin moved back above the important $70,000 resistance level, the next area to watch is between $72,000 and $74,000. This range is expected to play a major role in deciding where the price heads next.

If the asset manages to break above and hold this zone, it could pave the way for a move back toward its March highs. On the other hand, if the price struggles to stay above this range and faces rejection, it could slip back down toward the $68,000 level.