Santiment: Crowd Fear Triggers Bitcoin Bounce, $70K Rally in Focus

Bitcoin (BTC) slipped to around $60,000 earlier today before rebounding toward $65,000, following one of the sharpest daily sell-offs in its history. The move has split traders between those calling the rebound a temporary technical reaction and others pointing to extreme fear as a setup for a recovery toward $70,000. Fear Spikes as Bitcoin Rebounds From Sell-Off On February 6, Santiment noted that social media mentions calling for Bitcoin to go “lower” or “below” shot up after the drop to $60,000, a pattern the analytics firm said often appears near short-term price rebounds. The asset did indeed bounce back to about $65,000, with the uptick coming after what The Kobeissi Letter described as BTC’s first-ever daily drop of more than $10,000, alongside claims that a large leveraged position had been liquidated. “Is this nothing but a dead cat bounce?” Santiment asked, while positing that enough retail may have been shaken out to justify a quick rally back up to the $70,000s. The sell-off capped weeks of heavy downside pressure, as CryptoPotato previously reported, with Bitcoin wiping out gains seen after Donald Trump’s re-election and dragging most major altcoins lower. XRP fell 13% on the day, while Ethereum, Solana, and BNB also posted steep losses. Meanwhile, on-chain and derivatives data are painting a mixed picture beneath the rebound. According to DeFi commentator Marvellous, “smart money” has taken a net short position, while whales and public figures are adopting long positions. The market watcher argued the move looked more like a mechanical response after $2.2 billion in long liquidations than renewed conviction, noting that open interest remained elevated and funding rates had stayed flat. Elsewhere, trader Sykodelic highlighted a lopsided liquidation map, claiming the market had cleared most long positions, leaving roughly $29 billion in shorts versus about $100 million in longs over a one-year view. Price Action Shows Heavy Damage Despite Short-Term B...